Back in the March 2020 Budget, Chancellor Rishi Sunak announced that he would be ending fuel duty and VAT relief for privately owned boat using red diesel in their tanks. This means that owners and operators of privately owned boats and yachts will need to change to white diesel.
For many, the announcement may have come and gone without much fanfare but with legislation (and fines) set to kick in from April 2022, red diesel users have a limited time to find an alternative supplier.
As Rishi Sunak claimed at the time: “This is a tax relief on nearly 14m tonnes of carbon dioxide every year. It has been a £2.4bn tax break for pollution that has hindered cleaner alternatives.”
So do cleaner alternatives actually exist? Well, yes they do. And Certas Energy happens to be an exclusive supplier of Shell GTL in the UK. This cleaner burning alternative to both red and white diesel is the perfect replacement fuel for pleasure crafts operating in UK waters. It’s proven to reduce harmful nitrogen oxide and particulate matter emissions, while also being better at managing noise pollution.
Currently, duty on diesel charged by the Treasury is applied at two rates. The full rate, 57.95 pence per litre, is applied to white diesel. However, red or marked diesel is subject to a rebated rate of 11.14 pence per litre. Red diesel also qualifies for a reduced VAT rate of 5% compared to white diesel at the standard 20%.
Given these financial incentives, some pleasure craft owners could be forgiven for extending the use of red diesel up until the April 2022 deadline. But, in reality, most are paying the duty difference already so there are few reasons to not make the switch straight away.
As the UK’s largest independent fuel and lubricants supplier, Certas Energy is committed to helping our customers mitigate the potential impact of the proposed changes to the red diesel rebate. We offer a range of fuel supply and management solutions to keep businesses moving efficiently and cost-effectively.
These include bulk fuel deliveries with fixed pricing structures, technology such as telemetry to support more efficient fuel management.
For more on how we can help with cleaner burning fuels and supporting technologies get in touch below.