Wednesday, January 25, 2012

Road Haulage Groups Welcome Eurovignette Proposals for Foreign Trucks

EU HGV's Will Have to Pay on British Roads
Shipping News Feature

UK – The Department for Transport (DfT) today fulfilled a manifesto commitment by the Coalition Government and launched a consultation on a proposed road user charging scheme for heavy goods vehicles (HGV’s) of 12 tonnes and over. The intention is to ensure that foreign registered road haulage trucks pay toward the cost of transport infrastructure in Britain on a comparable basis with those of their native counterparts. In a statement Parliamentary Under-Secretary of State for Transport, Mike Penning said:

“Save on some specific pieces of infrastructure (the M6 and M25 Tolls and various bridges and tunnels), there are no tolls or user charges in the UK. As most foreign operators currently purchase their HGVs’ fuel outside the UK, they therefore contribute nothing towards the cost of our roads.”

The idea is to introduce a scheme which complies with the latest Eurovignette Directive which sets out a framework of rules for tolls and charges, including maximum daily rates and which is applicable to both UK registered trucks as well as other EU registered vehicles. The proposal is for a simple time-based charge, applying to the use of any road in the United Kingdom, meaning that a five axle HGV of 38 tonnes or more would pay £1,000 a year or £10 a day. The Eurovignette Directive’s maximum permitted charge is currently €11 per day, although by the introduction of the charge this is likely to have been uprated by inflation to €12 (about £10 at current exchange rates).

The precise level of charges will depend on exchange rate movements and inflation between now and the implementation date later this Parliament. UK hauliers would pay an annual (or six months) charge for each heavy goods vehicle at the same time and in the same transaction as they pay its Vehicle Excise Duty (VED). This would avoid extra administration costs for UK business. Foreign hauliers could pay daily, weekly, monthly or annual charges.

As VED and the new charge are paid 12 months in advance, UK hauliers would begin to pay the user charge as they renewed an HGV’s VED from eleven months before the introduction of charging for foreign vehicles. To offset the extra cost to UK hauliers it is likely there will be a similar reduction in the level of VED charges and the Government believes that if VED to levels are reduced to at or just above the minimum rates set out in the Eurovignette Directive, around 94% of the current UK vehicle fleet would be no worse off, with 98% paying no more than £50 a year extra.

The consultation will run until 18 April 2012. The consultation document and associated tax impact assessment are available in the Library of the House, or on the DfT website. Industry groups welcomed the news with Road Haulage Association (RHA) Head of Communications, Kate Gibbs commenting:

“This scheme is good news for UK transport operators and should be welcomed also by motorists, many of whom have complained that foreign hauliers pay nothing for using our roads. The RHA has been working with government officials to get the best scheme possible under EU rules and we believe this is what the new proposals represent. We are urging ministers to press forward with this project as a priority, both in terms of Parliamentary time and commercial dealings, so that the original deadline of spring 2014 start-up can be met.”