Reacting to the Budget announced today by the Chancellor, NFU
Scotland has said that the reform of the road tax (vehicle excise
duty) system from April 2009 and a further 2 pence hike in fuel
duties from October of this year, will heavily affect farmers and
all those living or working in rural Scotland.
NFUS has stressed that 4x4 vehicles are essential for
farmers and changing the tax bands to penalise more heavily polluting
vehicles will penalise farmers who have no choice but to use these
types of vehicles for business purposes. The key for farmers is
band G. An increase in the band G rate vehicle excise duty rate
will have a detrimental impact on farm businesses since farmers
are not able to purchase a vehicle that has lower CO2 emissions
and still be able to do the job required of it around the farm.
A ‘showroom’ tax will also apply from April 2010 as
buyers of more heavily polluting vehicles will have to pay additional
tax upon purchase, again penalising those who need to use such
vehicles for business purposes.
On top of this, a two pence increase in fuel duty is an unacceptably
heavy penalty for individuals with no practical alternatives. The
duty rise will be postponed until October but will nevertheless
have a huge impact on farmers and all those in the countryside.
On top of this, red diesel duty for off-road, agricultural vehicles
will also increase by two pence per litre from 1 October, significantly
The duty differential for biofuels will be abolished in 2010 and
from then the Renewable Transport Fuel Obligation (RTFO) will provide
the total incentive for biofuels although this announcement has
come as no surprise.
Some positive news includes a commitment to reduce regulatory
burden on small businesses.
NFUS President Jim McLaren said:
“The fundamental principle here is that farmers drive 4x4s
because they are essential tools for the job. The Chancellor is
clearly trying to penalise those driving big cars in city centres,
but hikes in excise duty next year will also be penalising those
who have no alternative. Particularly after the dismal year faced
by many farmers in 2007, an extra ‘showroom’ price
hike on what is an essential business tool is another slap in the
“The increase in fuel duty of two pence per litre from 1
October exacerbates the problems being faced in rural areas. Not
only do those living in the countryside have to deal with largely
poor public transport but higher fuel prices are also having a
huge impact. An implementation delay of six months really won’t
address any of the real problems.
“The Chancellor has announced he will maintain the differential
between red diesel and normal road diesel, but this means a rise
in red diesel duty of 2ppl in October as well. All duty increases
should be put on hold until world fuel prices are less volatile
and not simply for six months.
“On a slightly more positive note, the Chancellor did make
a fleeting mention of a desire to reduce the burden of regulation
for small businesses and so I look forward to learning more about
how he plans to do this.”
John Deere to Expand Production Capacity for Large Horsepower Tractors
New Holland Supports Taste East 2008
New Holland T4000 Tractors Lead Compact, High-Performance Sector