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9th March 2000, Page 22
9th March 2000
Page 22
Page 22, 9th March 2000 — DIESEL DEAL
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Which of the following most accurately describes the problem?

One way the government could reduce the cost of fuel to hardpressed hauliers without losing face would be simply to rearrange the tax system as it applies to fuel.

If it left the gross price at the pump unaltered but reduced the duty on the fuel and at the same time increased the percentage on the VAT to compensate, this would in effect reduce the cost of fuel to VAT-registered hauliers, while maintaining it for the general public.

Fuel at 77.9p/lit equals 66.3p (ex-VAT ® 17.5%), while fuel at 57.7p/lit (ex-VAT ® 35%) equals 77.9p/lit at the pump.

By juggling the tax system in this way a fairer price could be charged to business users. M Jones, Pembroke Road Freight. Pembrokeshire.