Comments provided by Head of Transport & Logistics Mark Perrin.
Following the Chancellor’s last Spring Budget, Menzies Transport & Logistics sector team have reviewed the impact of Philip Hammond’s announcement upon the UK transport logistics community.
Spring Budget 2017: The positives
Fuel duty, vehicle excise duty for trucks and HGV levy rates remain unchanged.
The changes in tax rates announced by Philip Hammond continues the governments theme of creating a level playing field when considering the tax status of individuals. Their aim appears to be to remove “tax” as being the key decision making factor for individuals when contemplating whether they want to be self-employed, run their own limited company or be an employee. This will be welcome by compliant operators in the haulage industry where there are many individuals claiming self-employed status when in fact they should be treated as employees. This is supported by increased cases which HMRC are pursuing and winning.
Spring Budget 2017: The Challenges
The government announced plans to invest £270m in electric cars and robotics. Given the governments focus on clean air zones, this doesn’t appear anywhere near enough investment to help the haulage sector to transition vehicle fleets to have lower emissions and impact on air pollution. There appears no incentives at this stage to help small companies to become “cleaner”.
The government is tabling a “detailed draft plan” in the Spring of this year which may provide further insight on how they will tackle “air quality”, which they emphasise is a significant issue. The Chancellor also indicated there may be changes to the HGV road use levy, which creates uncertainty but one may assume this will be linked with emission levels in vehicles and impact on the environment. The big question remains “what assistance will be provided by the government to assist the haulage industry to transition to cleaner trucks with lower emissions, particularly where operators are continually challenged with increased costs and lower margins?”
The increase in the insurance premium levy from 10% to 12% is an example of an unwelcome increase which hauliers will struggle to pass on to customers.
Get more input on the 2017 Spring Budget implications for the Transport & logistics sector by speaking to our sector team
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