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  1. #1
    Join Date
    Mar 2004
    Location
    Bristol UK
    Posts
    1,079

    Default Red Diesel - ALL to read please

    Hi all,

    I have received a response from my MP, who has asked me for a full and reasoned argument as to why we want Red diesel duty exemption keeping - he has no firm beliefs either way - BUT he is a VERY fair and sensible guy and very willing to help.

    The important thing is, if I can send him a rational and reasonable statement as to why we should keep red then he is happy to raise it with the treasury and will vote in favour of keeping it - but ONLY if we can come up with something.

    So - I am sure it has been done already.

    I can't send him something which just bleats about having to pay more - that isn't going to work, what I - well what WE - need is a clear, reasoned and powerful argument based on tourism, the industry, what would happen in Plymouth, Poole etc if the duty goes on, loss of resale means no-one can upgrade, no new boats etc etc etc.....

    If we can come up with something powerful enough then there is a very real chance that we can get a very active MP on our side.......

    Also, if we can then post a link here for the document, then everyone can send a copy (personalised) to their MP then perhaps for once we'll get what we want.

    Remember guys, apathy is what will kill the Red duty not the EU or anyone else....

    Please help me to help you.


    Cheers,

    Grant

    <hr width=100% size=1>Why can't we work 2 days a week and boat the other 5????
    Why can't we work 2 days a week and boat the other 5????

  2. #2
    Join Date
    Mar 2004
    Location
    Hamble/Southampton/$olent
    Posts
    83

    Default Re: Red Diesel - ALL to read please

    Well put...

    'Robih' wrote quite a good letter as a sample for anyone wishing to fax the local MP's...you will find here

    http://www.ybw.com/cgi-bin/forums/sh...14&part=2&vc=1

    At the time most of the forumites seemed to agree with the content so it may be benificial to use it in this instance too.

    Regards
    Simon

    <hr width=100% size=1>I'v got 2 ears.2 eyes and 1 mouth....if only i could use them in that proportion!
    I'v got 2 ears.2 eyes and 1 mouth....if only i could use them in that proportion!

  3. #3
    Join Date
    Aug 2003
    Posts
    18

    Default Re: Red Diesel - ALL to read please

    Good work, however can't you pass this onto the RYA who is mean't to have various bod's doing this already. I would hope that they have done some sort of information/press pack exactly for this????

    Who knows with the RYA more interested in "Raggies"?

    <hr width=100% size=1>

  4. #4
    Join Date
    Mar 2004
    Location
    Bristol UK
    Posts
    1,079

    Default Re: Red Diesel - ALL to read please

    Because I don't want everyone to keep "passing it on to someone else". Why do we motorboaters always assume that "someone should do something" and that someone is never US????????????


    I have looked at that article, and agree it's good - problem is it still addresses that we shouldn't be charged it - it doesn't give me a good argument WHY NOT??

    Please guys come on - if anyone has a good point to persuade a NON boater why we shouldn't pay it then lets hear it - because "we don't want to" isn't gonna succeed......

    Cheers,

    Grant

    <hr width=100% size=1>Why can't we work 2 days a week and boat the other 5????
    Why can't we work 2 days a week and boat the other 5????

  5. #5
    Join Date
    Mar 2004
    Location
    Bristol UK
    Posts
    1,079

    Default Re: Red Diesel - ALL to read please

    Also does anyone have the exact figures ( or a damn good estimate ) for the following things......:-

    1) The revenue raised on Duty on Marine Diesel in a recent year
    2) The revenue raised on Road Duty in that same yr
    3) The revenue raised on Marine Petrol (yep you did read that right)
    4) The number of people employed in the Marine Leisure industry in the UK - that is NOT including building boats, but marinas, chandleries, etc etc
    5) The number of people involved in MANUFACTURING boats
    6) The number of motorboaters in the UK

    thank you

    Grant

    <hr width=100% size=1>Why can't we work 2 days a week and boat the other 5????
    Why can't we work 2 days a week and boat the other 5????

  6. #6
    Join Date
    Jan 2003
    Location
    Hamble, Hants
    Posts
    124

    Default Re: Red Diesel - ALL to read please

    Parliamentary and Government Lobbying these days is not just a matter of a load of people sending off letters to MPs. This is a classic example of why we need a well organised, well connected and well resourced national body. Well, we’ve got one, and it’s called the RYA! And the RYA represents 100,000 members! One letter from the RYA, with a carefully researched report, to the right civil servant and minister, backed up if necessary by personal members’ letters to MPs at the right moment, is far more likely to have the right effect.

    Our club’s secretary has spoken to the RYA about this, and they contracted a consultant (last November) to research all the aspects of this topic and prepare a report to argue the case, to be published in September. This will be in good time to brief and secure the support of our politicians in time for the Brussels negotiations that will be happening in 2005. The questionnaire that has been going the rounds is part of this process.





    <hr width=100% size=1>

  7. #7
    Join Date
    Mar 2004
    Location
    Bristol UK
    Posts
    1,079

    Default Re: Red Diesel - ALL to read please

    Great - but that doesn't mean we shouldn't each get our own MP onside.....

    Lets be honest - if 50% of the MP's are on our side, and the other 50% couldn't care less, we've got a good chance.


    __________________________________________________ __________________

    Anyhow, I propose to send this off would love some more facts and figures to back up my theories.... comments gratefully appreciated.


    Dear Steve,

    Currently here in the UK we enjoy what is described as the “Concession” of being allowed to use Red Diesel in boats, both “commercial” and “Recreational”. However this talk of “ending the concession” is a bit odd to me, because I understood that whether red or white diesel was used for vehicles depended on whether it was being used as “road fuel” or not. Thus, Farmers, who put red diesel in their tractors, are entitled to do so because a tractor is not primarily a road vehicle. Likewise forklift trucks in yard premises where not taken on the road, and finally boats because they are clearly not using red diesel as road fuel.

    I remember this because there was an issue a few years ago where farmers were hauling sugar beet to the factory with the new generation of “fast” tractors (these tractors do 40mph) and Customs were questioning their right to use red diesel because the vehicles were primarily being used as road vehicles. The final argument came down (I think) to whether these tractors had standard field tyres or whether they had fitted “road tyres”.

    So, to remove the so called “concession for boats” as far as I can see the government have to change the law such that it is not determined by vehicle use but by some other method. If they don’t then surely farmers (and fork lift trucks and trawlers and council grass cutting machinery and lorries on container ports etc………………) will also all have to use white diesel instead of red.

    If the government say well “leisure boats are to use white diesel” then I can see a ridiculous situation where people running boats will fit a LAN (Local Area Network) on it pretty quickly with a special locker for the server and fax! “No Sir, not a leisure boat but a floating office”. Or perhaps everyone will carry a hamster – “No Sir not a leisure boat, but livestock shipment” etc etc.

    I do agree that there is an anomaly in the VAT rules for boats or at lease well the rule for boat diesel is nonsense. Because of something strange in the VAT Act we only pay 5% (on small quantities) of red diesel whereas it is arguable we should pay the full 17.5% rate (farmers do!). There is an argument that Gordon Brown could go for that and I wouldn’t have such an objection. (The effect would be an increase from 35ppl to 39ppl which is 11%, fair do’s).

    In the UK we have a small but healthy boatbuilding industry, one of the very few manufacturing industries we do have left. Large craft manufacturers such as Princess, Fairline, Sunseeker are all based in the UK, and export around 70% of their output – this contributes wonderfully to our balance of Trade, and indeed a massive contributor to local economies, bringing massive investment in plant, equipment etc not to mention jobs. There is also the money that the Marine industry brings in to coastal (and often otherwise deprived areas of the UK).

    To take an example I would like to use Poole in the UK and run through an imaginary scenario – this is not the only town that could well be affected in a similar manner should this situation come to pass.

    Budget 2006:- Chancellor Gordon Brown announces that the Duty “Concession” for Marine Diesel is to be withdrawn from 01.01.07.

    Early 2007:- Boat Show attendances at Excel in London’s Docklands are down by 35% and for the first time ever the show barely makes a profit. Local manufacturers such as Princess, Fairline, Sunseeker all report no sales to owners based in the UK who intended to use them in the UK, but overseas sales were still strong and all UK purchasers declared they intended to use their new boat in Jersey or offshore and would therefore be reclaiming the VAT on the purchase. As this is the domestic show, overall sales down by 80%.

    March 2007 :- Cobbs Quay Marina announce that only 60% of their annual bertholders who own a motorboat have renewed their annual fee causing them severe cash flow problems. With 50% of their berths occupied with Motor Vessels, and only 60% of them renewing, they are only 70% full on expectations. More severe problems are reported by Salterns Marina where, being a mainly motor boat marina, and catering for larger vessels, only 40% of their total bertholders have announced they will be renewing their subscription. They announce 10 redundancies. Similar stories come in from all the other marinas in the area with a total of 100 redundancies.

    May 2007:- Sunseeker announce that due to a huge drop in domestic sales, they have to lay off 100 staff.

    June 2007:- Salterns Marina announce that due to the drop in bertholders coupled with a 85% drop in visitors travelling around the coast domestically or travelling from the coast of Europe they are suffering huge losses, and the marina is up for sale. Another 10 redundancies are announced. Both Salterns and Cobbs Quay Marina report a drop in Marine Diesel sales of 96% - with most owners reporting they are now purchasing their fuel from France, Jersey or Guernsey or the fuel barge that has now appeared 5 miles outside of UK waters. With this complete lack of fuel sales they close their fuel sales facilities with the loss of an additional 5 jobs.

    Summer 2007:- Local Pubs, Restaurants and shops report significant loss of trade over the preceding 6 months due to a lack of visitors both domestic and oversees. Some have been forced to close with 100 redundancies.

    This carries on………

    Put simply, the miniscule amount of money gained from the application of increased duty will be vastly countered by the fact that by definition, boat owners can travel offshore to purchase fuel more economically, many owners will not stop using their vessels at all, they will simply move them to another country where the weather is better and the cost would become lower than keeping them here.

    There are also the safety issues, in order to take advantage of the cheaper fuel abroad, people will run their boats lower on fuel rather than fill up here in the UK. This means that the number of rescues that the Coastguard will be required to carry out will rise dramatically.

    On small (under 35’) boats, the additional cost of diesel engines would no longer be worth it. This means that these boats would cease to be sold at all in the UK – or they would be sold with petrol engines, inherently more dangerous and the number of deaths and injuries from boat fires would increase sharply.



    So, my message for Gordon Brown is:

    1. Leave red diesel law as it is (unless you are also taking on everybody else as well, don’t just stick the knife in to boaters).

    2. You can have 17.5% VAT on boat diesel, that gives you some cash and it’s fair enough.

    3. If you DO “harmonise” rates of duty here in the UK with Europe, don’t forget that if you raise the duty on Red Diesel, you will also have to lower the cost of Road fuel duty by around 80% - imagine the loss in revenue to the treasury.

    4. The RYA may well launch an application that applying Road Duty to marine fuels is actually illegal?

    5. Be prepared for the hidden cost. In certain parts of the country, the loss to tourism, manufacturing and the leisure industry will more than outweigh the revenue raised without taking into account the increased cost of redundancies.

    6. The Marine industry automatically transfers wealth from the richest parts of the country, such as London, Bristol, Birmingham etc and moves it to the Coastal regions such as North Wales, Cornwall, Devon, Dorset, Scotland. By taking this wealth overseas, the damage could be horrific.

    7. Also I wonder why we have to pay the totally ridiculous pump prices we do for petrol for boats. Petrol is subject to road fuel duty, yet the boat never uses the road, and if it does then it’s use is paid for with the duty on the fuel on the towing vehicle. Many boat owners won’t pay the high prices in marinas for petrol, and thus most marinas won’t bother selling it. This leads to serious danger for many petrol boat owners who are on long passages and run out of fuel. It also means that most owners tow their boats full of fuel rather than keep them empty till they reach the sea. Thus if a boat is in a road Traffic accident then there is 30 gallons (or often more) of petrol for the emergency services to deal with.The cost to the treasury of providing coastguard services to the people who run out must easily match the revenue raised from the petrol at marinas, and I would propose the introduction of Red Petrol at Marinas around the UK. After all, why should a boat pay a road duty?



    I hope this helps, but if you would like more information, please contact the Royal Yachting Association at .........



    <hr width=100% size=1>Why can't we work 2 days a week and boat the other 5????
    Why can't we work 2 days a week and boat the other 5????

  8. #8
    Join Date
    Feb 2004
    Location
    Chandlers Ford, Hants
    Posts
    457

    Default Re: Red Diesel - ALL to read please

    Hi Steve,

    I thought your approach pretty constructive. It seems that this argument that it is NOT a concession but that the tax should apply to DERV only, not unreasonable. I also think the low rate of VAT IS a bit of a concession, but I am not sure who it was intended for, as commercial Fishermen and commercial boat users would claim it back anyway.

    G Brown will get tax off his granny if he could get away with it. Having already raided pension plans so we should not have any doubts about that.

    Back to practicalities. Would it actually be cost effective for marine diesel retailers to carry both red and white diesel? I think not somehow. I also doubt that they would leave it to the retailer to state what the purpose of a particular sale was. The status quo is obviously what we would prefer, but where the strongest argument for the government to listen to I am not so sure. Perhaps a face to face with your MP will help? Maybe he will be more aware of sensitivities, so perhaps he could help you to come up with an angle.
    Certainly a big price hike WILL hit the industry, but hell they have hit most industry at some point without turning a hair. Most high volume manufacturing has closed down and gone abroad. They have all but given our fishing industry away to the EEC. What WILL they listen to? Back to the MP? Keep us posted.

    <hr width=100% size=1>

  9. #9
    Join Date
    May 2001
    Location
    South coast
    Posts
    3,330

    Default Re: Red Diesel - ALL to read please

    "Early 2007:- Boat Show attendances at Excel in London’s Docklands are down by 35% and for the first time ever the show barely makes a profit. Local manufacturers such as Princess, Fairline, Sunseeker all report no sales to owners based in the UK who intended to use them in the UK, but overseas sales were still strong and all UK purchasers declared they intended to use their new boat in Jersey or offshore and would therefore be reclaiming the VAT on the purchase. As this is the domestic show, overall sales down by 80%."


    So why would that happen then? Because the fuel costs for a typical 40 foot cruiser go up by £1,000/year? It didn't happen when marina berths went up any year.

    Not arguing against your fight to keep red diesel, but you want to use arguments that stand up to scrutiny. To suggest that removing the red diesel cost will result in NO boat sales to UK users at London Boatshow is patently ridiculous!


    "May 2007:- Sunseeker announce that due to a huge drop in domestic sales, they have to lay off 100 staff."

    What percentage of Sunseeker sales are to the UK? 5%? So if UK sales were to halve because the people spending £1/2 Million on a brand new Sunseeker and £100K a year to run it (figure first year depreciation on top of usual running costs) decided they couldn't possibly afford a few quid more on diesel then Sunseeker sales get slashed by a massive 2.5%!

    I think you need to drop the imaginary scenario to be honest...

    <hr width=100% size=1>
    Ari

    ---------------------------------

    If a man speaks in a forest, and there is no woman to hear him, is he still wrong..?

  10. #10
    Join Date
    Mar 2004
    Location
    Bristol UK
    Posts
    1,079

    Default Re: Red Diesel - ALL to read please

    Hmmm that bit might need a rethink for sure...... lol

    Thanks tho all - this kind of feedback is what I need.

    Certainly I think I need some sort of scenario though - my MP doesn't know much about the marine industry - I need to put in his mind all the OTHER things that might be affected I think....

    <hr width=100% size=1>Why can't we work 2 days a week and boat the other 5????
    Why can't we work 2 days a week and boat the other 5????

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