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Car tax changes: UK urged to copy Romania’s fuel tax system to boost 'jobs and business'

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FairFuelUK has pointed at other EU nations such as Romania as an example to follow on future taxation rates. Founder Howard Cox said copying Romania’s tax system would have benefitted “GDP, jobs inflation and business investment”.

The comments come after new data from the group has revealed UK drivers are the highest taxed in Europe with fuel duty making up 65.3 percent of total charges.

In comparison, drivers in Romania are charged an average of just 51.1 percent tax on their petrol and diesel costs.

Poland, Hungary, Luxembourg and Spain all charge below 54 percent, while Bulgaria and Cyprus are below 55 percent.

Meanwhile, Italy, France, Ireland, Netherlands and Belgium join the UK as some of the most expensive regions.

READ MORE: Fuel duty increase would have a ‘disproportionate’ impact on drivers

The six countries all charge more than 62 percent tax on their fuel costs which continue to hit drivers pockets.

Speaking to Express.co.uk, Mr Cox said the decade long freeze had reduced inflation” and “bettered incomes”.

He said: “The Centre for Economic and Business Research tell us the decade long freeze in fuel duty has reduced inflation by 6.7 percent and bettered household real incomes, especially those of poorest households, by £24bn per year.

“Imagine if [the] UK’s fuel duty had been at the equal of Romania’s, how that level of taxation would have benefited GDP, jobs, inflation, and business investment.

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Rishi, please wake up and recognise that more money in peoples’ and businesses’ pockets will rocket UK Plc, and most certainly not by punishing the world’s already highest taxed drivers with an inane duty hike in your March 3 Budget.”

The Treasury has previously predicted each driver may have saved up to £1,200 each as part of the decade long duty freeze.

However, the scheme may have cost the Treasury over £100billion in extra revenue generated from millions of drivers.

More drivers switching to electric cars has seen traditional fuel duty and Vehicle Excise Duty (VED) revenues fall by around £40billion.

The group found a 2p rise could generate up to £470million in extra revenue in the short term.

But this could drop as low as £50million within 20 years as more road users ditch their combustion cars for new electric models.

The CEBR report also found a rise in fuel duty could create “economic damage”. 

Craig Mackinlay MP said: “Fuel duty rises are not supported by the public because they are bad for the economy, bad for business and bad for jobs.”



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