HC Deb 24 March 1999 vol 328 cc257-8W
Mr. Whittingdale

To ask the Chancellor of the Exchequer if he will set out the assumptions used in calculating the annual saving of carbon if the road fuel duty escalator is maintained at its present level until 2010 as in Customs and Excise Press Notice, C&E11. [78017]

Ms Hewitt

Table 5.1 in the 1999 Economic and Fiscal Strategy Report and Financial Statement and Budget Report contained an environmental appraisal of those Budget measures which were primarily environmental or which are likely to have a significant environmental impact.

The road fuel duty escalator over the period 1996 to 2002 is estimated to reduce annual carbon dioxide emissions by between 2 and 5 million tonnes of carbon in 2010. Footnote 6 of Table 5.1 explains that this estimate is based on the Department of the Environment, Transport and the Regions "1997 National Road Traffic Forecast" and the methodology set out in "Energy Paper 65" published by the Department of Trade and Industry in 1995.

Mr. Whittingdale

To ask the Chancellor of the Exchequer what plans he has to continue to implement the road fuel duty escalator in future years; and if he will set a final date for implementation of the duty escalator. [78016]

Ms Hewitt

The road fuel escalator, which provides for duty increases on road fuels of at least 6 per cent. above inflation, shows the Government's continuing commitment to the environment and to the 'polluter pays' principle. It will help the Government to deliver the UK's share of the EU target to reduce emissions of greenhouse gases by 8 per cent. by 2008–2012. Our environmental assessment shows that the escalator, if continued at its present level until 2002, will improve urban air quality and reduce greenhouse gases by between 2 and 5 million tonnes of carbon a year by 2010. The future of the road duty escalator will be considered each year in the Budget.

Mr. Redwood

To ask the Chancellor of the Exchequer if he will estimate the annual cost for businesses of the additional fuel duties introduced since 1 May 1997. [76260]

Ms Hewitt

The collection of excise duty is the responsibility of HM Customs and Excise. The annual cost to business of the existing road fuel escalator commitment, inherited from the previous Administration, is estimated to be about £2.5 billion. In addition, Customs estimate that the annual cost of the charges to fuel duties announced in the 1997, 1998 and 1999 Budgets is about £750 million.

Although it was legislated for under the previous Government, the separate rate for ultra-low sulphur diesel did not come into effect until after 1 May 1997 and has therefore been treated as a change since that date.