HRMC clarified the way in which additional fuel duty is to be collected from the 1^st November 2008, at the Southampton Boat Show. It will affect private pleasure craft owners when purchasing red diesel for propulsion and to a lesser extent when purchasing red diesel for heating.

How will it work?

Private pleasure craft owners will be able to continue to use red diesel for propulsion use, but at a modified duty rate.

They will have to declare the percentage of fuel to be used for propulsion and domestic use respectively at time of purchase.

HMRC say “It is for the purchaser to declare the percentage of fuel used for propulsion.  However, analysis by both the industry and HMRC suggests that a split of 60% for propulsion and 40% for domestic use (heating, cooking etc) probably reflects most people’s use and it is therefore likely that many users will declare such an apportionment.”

Example:  100 litres purchased by a pleasure craft owner.

·         40 litres subject to the current rate of duty - 9.69 pence per litre (ppl) at 5% VAT

·         60 litres subject to full duty - 50.35ppl at 17.5% VAT.

The combined effect could well raise the cost of the fuel from 70p a litre to about £1.27 for propulsion.

Registered Dealers in Controlled Oils (RCDO) will need to account to HMRC for any additional duty they receive from recreational boaters.  RCDOs already owe a general duty of care to ensure that they only make supplies of controlled oil for legitimate uses.

Residential Boat Owners

Residential boat owners whose primary residence is their boat and hold certain documentation, such as a Houseboat Licence, Residential Mooring Licence, Council Tax Bill in respect of the mooring, or other peripheral documentation, invoices or bills which provides proof of permanent residency, they may purchase all their fuel at the rebated rate

Effect on the industry.

Availability and supply facilities remain unchanged at present. The increase in fuel costs over the last year will undoubtedly hit some areas of leisure boating. However from the 1^st November with resourceful boat owners adapting to new fuel duty legislation and perhaps using their boats slightly less than the current average of 50hrs per year, against a backdrop of possible recession it will be difficult to measure alone the effect this change in legislation will have on the U.K. boating industry.

www.marinefuelpoint.com         17^th September 2008

With oil at under $100 per barrel down from Aprils $147 per barrel, how soon before the price comes further down at waterside refuelling? Send a price update via the site for your local waterside refuelling point and we’ll update.

As the price of fuel increases well documented cases of recent fuel theft from buses, farms tanks and haulage vehicles are focusing the minds of boating business to come up with solutions to protect the fuel tanks on all types of boats.

In the U.K. boat owners seeing the price of the red diesel increase in line with other petro-fuels are already bracing themselves for further increases. From November 1^st 2008 the U.K. falls into fuel duty alignment with the European Union and ceases the derogation of red diesel for propulsion onboard private boats.  In addition the British government has taken the initiative to add the full duty of about GBP 0.55p per litre where the European Union suggests GBP 0.21 per litre.  The value of the fuel in the tank is set to nearly double, so why not invest in new deterrents?

One such device is called ‘Fuellock’

Advantages

·         Lessens the risk of attracting thefts of fuel from craft which are left unattended.

·         Insurance companies tend to treat fuel as a consumable item. This means boaters are not usually covered for thefts of fuel.

·         Colour coded lids lessen the risk of wrong fuel into tanks e.g. Diesel and Petrol.

·         Water tanks locks are also available and since coded in different colours prevent further cross contamination between fuel and water.

·         Retailing at GBP 34.99 plus P&P for one fuellock it becomes a relatively inexpensive method of protecting the fuel tank.

Disadvantages

·         Can only be retrofitted to any boat whose deck fittings use the popular 1 ½  inch BSP thread. Check your deck fittings.

·         Can any fuellock be 100% secure against the determined criminal?

Conclusion

In the U.K. summer of 2008 for 1,000 litres of red diesel the cost is around GBP 750 and for leisure marine users it is set to rise above GBP 1350 from November 01^st . Providing retrofit is possible it seems a small investment over the long term to protect ones fuel tank from theft and limit the risk of cross contamination..

www.MarineFuelPoint.com