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UK Seeks To Expand Fuel Rebate Scheme

Tuesday, 06 August 2013   (0 Comments)
Posted by: Author: Amanda Banks
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Author: Amanda Banks

The UK Government is consulting with fuel retailers in rural areas on the cost of gasoline and diesel, as part of a bid to extend a European Union-approved island fuel duty discount scheme to remote areas on the mainland. The move will require a derogation from the EU Energy Tax Directive.

Currently, retailers within the Inner and Outer Hebrides, the Northern Isles, the Islands of the Clyde and the Isles of Scilly can claim back five pence per liter relief on unleaded gasoline and diesel for retail sale within the eligible areas. Following registration with HMRC, retailers can make claims on a monthly basis, and have an initial period of 60 days to reduce the cost of every liter of road fuel sold by the equivalent amount of the relief claimed.

Chief Secretary to the Treasury Danny Alexander explained that the rebate provides "much needed help" in some areas where transport costs make the cost of fuel prices higher, but that there are other remote rural areas which are not covered by the arrangement. He explained: "We will need to prove that there are areas which are similar to the islands in terms of pump prices and distribution costs, so I would urge local areas that may qualify to provide the information we need to make the case as robust as possible."

Nearly 1,500 retailers in 36 counties and districts in England, Wales, Scotland and Northern Ireland are being consulted, with a view to submitting an application and evidence to the EU over the autumn.

The Government wants to identify areas were prices are consistently similar to those on the islands, and it cautions that locations where prices are consistently below these levels are "extremely unlikely" to be included in the concession. In October 2012, according to Government figures, ordinary unleaded gasoline on the islands cost 144 pence per liter (ppl), dropping to 143 ppl in November and to 139 ppl in December. Over the same period, diesel fell from 148.5 ppl in October to 148 ppl in November, and then to 145.5 ppl in December.

The Government is inviting data from the following areas: Aberdeenshire, Angus, Antrim, Argyll and Bute, Armagh, Ballymena, Ballymoney, Banbridge, Coleraine, Cookstown, Cornwall, Cumbria, Devon, Down, Dumfries and Galloway, Dungannon, Fermanagh, Gwynedd, Herefordshire, Highland, Isle of Anglesey, Larne, Limavady, Magherafelt, Monmouthshire, Moray, Moyle, Newry and Mourne, North Yorkshire, Northumberland, Omagh, Perth and Kinross, Powys, Scottish Borders, South Ayrshire, and Strabane.



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