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Most of the price we pay for petrol or diesel is tax. We recently carried out research showing that motorists pay excess taxes of around £18 billion over and above the cost they would reasonably be expected to pay for things like road building. This is especially tough for families and businesses as it is now more expensive than ever to do the school run, go for the weekly shop, or for small business owners to go about their work. It also hurts the UK’s competitiveness: European rates of fuel duty are up to 24p per litre less than in the UK. There was a 1p per litre cut in fuel duty in the Budget four months ago but that was little more than a gesture to long-suffering motorists.
The campaign FairFuelUK has been set up to try and change this. Robert Halfon, MP for Harlow, has also set up the FairFuelUK All Party Working Group in the House of Commons. On Wednesday, the group rolled a car down Whitehall to ‘push’ for lower pump prices and draw attention to the issue. The group then delivered a letter outlining their concerns to David Cameron at Number 10. We joined them to show our support for lower fuel taxes.
If you think that petrol and diesel prices are too high then add your voice to their campaign. They have a petition on their website which you can sign here. Additionally, you can write to your MP and ask if they are joining Mr Halfon’s FairFuelUK All Party Working Group.
The national debt will get bigger by the end of the Parliament. This puts a huge burden on taxpayers and especially on future generations; it hurts our prosperity too. We’ll end up spending more money on debt interest than on things like educating our children. The Office for Budget Responsibility (OBR) has just released estimates of how big this could get over the next fifty years and the figures make for frightening reading – debt could be up as high as 107 per cent of GDP by 2061. There were reports that this could mean income tax hikes of 12 pence. But the Government must correct this trend by reducing spending, not increasing taxes.
Also, the OBR’s figures assume no changes to things like our tax system. This is something we are working hard on with the Institute of Directors – our 2020 Tax Commission has now been running for six months, holding meetings and hearing evidence about how our tax system should look by the year 2020. The Commission will publish its final report – with comprehensive recommendations for a simpler and less burdensome tax system – early in 2012.
On the OBR’s report, TPA Director Matthew Sinclair said:
“The Office for Budget Responsibility is right to echo warnings from other organisations like the Bank for International Settlements that Britain’s public finances are simply unsustainable in the long term. Politicians should be facing up to the challenges of an ageing population, and the uniquely difficult position Britain is in with critical services mostly used by the elderly paid for almost entirely out of general taxation and becoming a lot more expensive. Instead we are going to have a poor start thanks to the borrowing binge the public sector is on at the moment. Tax hikes depress long run economic growth and therefore aren’t going to fix this kind of long term imbalance in the public finances. The Government just needs to start living within taxpayers’ means.”
Hands off our holiday, Mr Taxman
Aviation taxes have risen sharply over the years, particularly when they were doubled in 2007, and Britain now has incredibly high rates compared to other European countries. Air Passenger Duty (APD) taxes will be increased next year by double the rate of inflation, and aviation will also be included in the European Union Emissions Trading System.
The UK's aviation tax is already 8.5 times more than the average across Europe, and these increases are going to make that figure higher. All of this means much higher fares at a time when many are already struggling to afford a holiday.
A campaign has been launched called 'Hands off our Holiday, Mr Taxman'. If you would like to help, the campaign has set up a system for you to write to your MP. Click here and make sure your MP knows your views.
Wining and dining at our expense
This week we highlighted how the Lord Mayor of Hull is spending our money to wine and dine councillors. The reason given for the dinner is that it will give new councillors an opportunity to see the Lord Mayor's Parlour! At a time when every penny counts, he should be keeping his spending to a minimum; however we know he is not alone in wasting money this way. If you have any examples of similar waste, please get in touch. If you want to find out how much your mayor has spent on hosting civic functions, send a Freedom of Information request to your council. E-mail our Grassroots Coordinator, Andrew Allison, if you would like a template letter and be sure to let us know what you find out by forwarding on the response you receive.
The best of the week's blogs
Burning Our Money: Non-job of the week - Our praise for Liverpool City Council was premature, explains Andrew Allison
2020 Tax Commission: Why tax hikes aren’t the answer to our long term fiscal problems - Matthew Sinclair looks at how tax hikes choke off growth
Campaigns: The Government fiddle with their disastrous energy policy while nearly a fifth of households are in fuel poverty - Nearly a fifth of English households are in fuel poverty thanks in part to the incredible cost of climate change policies, writes Matthew Sinclair
Campaigns: Out of touch politicians still think the old expenses system worked - Nearly a fifth of MPs still believe they shouldn’t be made to show receipts for expenses claims, and almost a quarter think the previous system was fit for purpose, writes Darren Rutland
Grassroots: West Country Transport Waste - Multi-million pound transport schemes surge ahead across the South West despite the need to rein in council spending, writes Tim Newark
2020 Tax Commission: No cuts, no growth, no surprise - Rory Meakin says real growth will come through tax reform and deregulation