Drivers and farmers around the country can breathe a sigh of relief after the Government confirmed that taxation of red diesel would not be changing.
Red diesel, or rebated biofuels, are used by farmers and other groups since it is far cheaper than normal diesel and is exclusively used away from public roads.
There had been rumours that the rate of red diesel, which is currently taxed at 11.14p per litre, would be changing, delivering a hammer blow to thousands of users around the country.
Any hike in tax would significantly impact these groups, especially since it has a much lower rate than standard "white" diesel at 52.95p per litre.
Do you have a story you'd like to share? Get in touch by emailingmotoring@gbnews.uk
There had been fears that the Government could change the taxation on red diesel
HMRC/PA
The Department for Transport estimates that red diesel makes up over 15 per cent of total diesel use around the country, with the Government launching a consultation in 2018 to better understand the use of the fuel in different sectors.
Speaking to Martin Daubney on GB News last night, Howard Cox, founder of FairFuel UK, said: "In the space of 48 hours, about 10,000 emails went to [The Treasury].
"So, they're under no illusion that we're going to take this lying down.
"I didn't expect to get a continued freeze on duty tax last Budget, back in last Autumn. I was quite shocked by that."
The fuel is dyed red with chemical markers to differentiate it from standard diesel to ensure that HMRC can enforce the law.
If caught illegally using red diesel, drivers may have to pay the fuel duty evaded, going back up to four years, and pay a "wrongdoing penalty" based on the extent of their illegal fuel use.
HMRC can also seize the oil and any containers and equipment used to abuse red diesel rules under Section 9(2)(a) of the Finance Act 1994.
A Government spokesperson previously told GB News that it would not be commenting on speculation ahead of the Spring Statement.
Data from NFU Mutual found that the cost of red diesel theft in 2022 soared to a staggering £886,000, representing a 145 per cent increase.
Construction sites and farms were targeted by criminals most often, with NFU Mutual working with rural businesses to crack down on the issues.
It is estimated that red diesel produces nearly 14 million tonnes of CO2 per year, with particularly high emissions rates seen in the construction industry.
The 2022 Budget removed the entitlement to use red diesel in most sectors to crack down on the high emissions from the fuel.
LATEST DEVELOPMENTS:
- Electric car sales dominate Europe with driver interest in petrol and diesel vehicles dying off
- Sadiq Khan bans electric scooters and e-bikes from London transport network after fires and 'great concern'
- Millions of British drivers urged to take 'five minutes' to sort DVLA car tax issue or face huge fines
Standard vehicles are not allowed to use red diesel on public roads and can face hefty fines
WMPTRAFFIC/ X
The fuel duty rate on red diesel was hiked in a bid to encourage more industries to choose alternative fuel sources.
Previous research from CPS Fuels reported that businesses switching from red diesel to standard white diesel would pay an additional 46.81p per litre.
