14 July 2022

Will Zahawi and Johnson take their chance to tax fairly?

On Friday 8 July 2022, the National Federation of Builders (NFB) wrote to the new Chancellor of the Exchequer, the Rt Honourable Nadhim Zahawi MP, to ask him to reinstate the construction industries access to red diesel

Richard Beresford, chief executive of the NFB, said: “Covid stopped the development and growth of alternative fuels and machinery, and compared to pre pandemic red diesel prices the cost of white diesel is now 200% higher. As we warned, fuel thefts are up, the alternative fuel competition isn’t yet delivering, almost half of industry can’t access the ‘Super Deduction’ and businesses struggle with the accounting for ‘Annual Investment Allowance’.


The previous system where red diesel was simply accessible meant everyone benefited, the new one penalises industry and especially small business and sole traders. The new Chancellor should reinstate the red diesel access for twelve months, something his predecessor chose not to do even after a major industry campaign.”

The NFB supports the Governments decarbonisation efforts but as companies close because of the impacts of inflation and higher taxation, the decarbonisation innovation and markets required for growth will inevitably shrink. In a global crisis on so many fronts, we should not be harming the businesses that enable and sustain levelling up in practice.


Beresford concluded: “With the war in Ukraine, semi-conductor shortages impacting the growth of electric plant machinery, global lockdowns hindering bio-fuel production, new government regulation putting up the price of construction and a desperate cost of living crisis, the removal of red diesel access for industries that helped pay for furlough but broadly didn’t avail of it, is hindering not helping Britain.

The Chancellor and Prime Minister say they believe in lower taxes but will they use one of the only energy mechanisms they have to reinstate the construction industries access to red diesel for the next twelve months?”