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HGV Levy Changes: Is Tax Our Best Solution?

For those in the logistics industry, news of the new HGV Levy Tax has been unavoidable. In essence, in order to tackle emission levels in our country’s most polluted areas, from 2019 the Government will introduce additional tax rules aimed at HGVs which don’t meet the latest emissions standards.

 

Looking to tackle nitrogen oxide in particular, the Government claims that lorries make up for 5% of the country’s mileage, but produce around 20% of the total emissions in the UK. Those who do not meet the new standards will see a significant 20% added to their tax bill. But there is an upside – those who do meet the standard will be eligible for a 10% reduction in their road tax.

 

Of course, the protection of our planet is of the utmost importance. Here at Barnes Logistics it is a much discussed topicon our blog page, and one which – as a responsible business – we understand we have a significant role to play. There is no denying that HGVs produce larger amounts of emissions and this is a key factor to tackle in the battle for the future of our planet, but is a simple tax the best means of creating a better future for us all?

 

The main issue with the new HGV taxes are very aptly summed up by Christopher Snelling, Head of UK Policy at the FTA: “Over 90% of everything the public eat, drink, wear and build with travels on an HGV at some point in the supply chain.”

 

This poignant statement brings the Government’s previous 5% mileage and 20% emissions claim into a much broader perspective. Of course we must work towards a greener future where lorries are concerned, but the logistics industry is one which is weaved throughout the entire of the UK’s economy – it is not a merely internally benefitting business.

 

Almost every single business across all sectors rely on incoming deliveries of ingredients or parts, and outgoing distributions are necessary for finished products to be shipped to paying customers. So although HGVs may create a fifth of the country’s nitrogen oxide emissions, over 90% of the country benefit from the services provided by logistics experts. So why should drivers and logistics companies be the only ones punished?

 

Of course, we understand that a line must be drawn somewhere, and that taxing businesses for their use of logistics services is somewhat unachievable, and may impact small businesses in particular who may struggle to find the extra funds to cover the costs of their deliveries.

 

So what could be a more sophisticated alternative? Perhaps in the future, the taxes saved and made from these new laws could all be invested into the advancement of more eco-friendly HGV technology, and these technologies could be made more accessible to logistics businesses of all sizes. It would seem to us that the solution lies in creating more advanced possibilities for the logistics industry, as opposed to the relative simplicity of punishing one body for a service that is required by all. If the future of HGVs is lower emissions, more investment must be made into greener technology.

 

What are your thoughts on the new taxes, do you think that there is a better alternative?