§ 40. Sir H. Williamsasked the Chancellor of the Exchequer whether his attention has been drawn to the proposal of the British Transport Commission to increase the use of diesel-engine locomotives on the railways for the purpose of attracting passenger traffic from road to rail; if he is aware that when diesel fuel oil is used on railways it pays no tax, whereas when used in road vehicles it is charged a duty at the rate of 2s. 6d. a gallon; and what action he is taking to correct this anomaly.
§ Mr. Boyd-CarpenterI am aware that the British Transport Commission has recently announced plans to extend the use of trains running on diesel fuel, partly in substitution for existing steam services. As heavy oils were made dutiable when used as road fuel because they then replace dutiable light oils, and are not dutiable when used for other purposes, their use by British Railways is not, in my view, an anomaly.
§ Sir H. WilliamsWhy should tax be paid on the fuel of a passenger road vehicle when no tax is paid on the fuel of another vehicle, also carrying passengers? Is not that prejudicial to the use of the road?
§ Mr. Boyd-CarpenterBecause for many years the duty on heavy diesel oil has been applied only when used on the roads—that is to say, in direct competition, in road use, with petrol.
§ Mr. Ernest DaviesIs it not a fact that whereas the road user has his permanent way paid for by the State and the local authorities, the railways have to maintain their own permanent way?