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Are foreign operators ready for the UK’s new truck tax?

[ March 26, 2014   //   ]

The UK’s new truck levy will be introduced on lorries on 1 April. Ironically, despite years of procrastination and consultation, its actual implementation is being rushed through in just three months, and has probably taken not only transport operators but officers for the Government’s Driver and Vehicle Licensing Agentcy by surprise, says managing director of Rhenus UK, David Williams. “Is the UK government tempting fate to launch such a complex scheme on April Fool’s Day,” he asks?

The long-awaited charge must be paid by both UK and foreign operators of vehicles at or above 12 tonnes in weight.

The good news for UK operators is that vehicle excise duty rates will be reduced accordingly to keep the overall tax bills neutral for the majority of hauliers. However for foreign operators, this means a major hike in annual costs. In practice the new levy could add as much as £1,000 per year to a foreign driver’s bill.

UK registered lorries will pay the levy annually or every six months, via the DVLA’s website upon licence renewal, or at first licensing, from 1 April 2014.

But while the UK side of the equation should be relatively simple to enforce, but the pan -European aspect of the levy promises to be much more of a challenge.

DVLA and VOSA, who are responsible for enforcement of the new levy have a tough task with just three months for implementation from a standing start in January 2014 (the month the April 1 launch was announced).

The DVLA says on its website that, “foreign operators must pay the levy before their lorry uses UK roads – preferably online through an HGV Levy Payment Portal”, (operated by Northgate Public Services) which poses several fundamental questions. Is the new levy being promoted effectively across all EU member states? How will incoming trucks be monitored? And how will drivers ignorant of the new regime rolling off the ferries and channel be managed?

Williams says “While I agree totally with the principle of a level playing field across EU motorways, I have real fears that the roll out of a pan European online and paper based licensing system needs more than three months to be implemented. I hope I am proven wrong and the whole process works seamlessly. I called a handful of hauliers Rhenus engages via its European network, and a significant number had not even heard of the incoming levy.”

 

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