Does it make sense to reduce fuel duty?

[finisterre]

Does the price of fuel limit your mobility?


Following on from the fuel thread where it was clear that we pay a fair bit of tax on petrol I was wondering how necessary it is to tax at the rate we do? Is it possible that the quantity of tax raised could be increased by dropping the rate?

From the Laffer curve Laffer curve - Wikipedia, the free encyclopedia

It appears there is a point where tax revenue starts to fade due to people choosing not to bother earning the money to be taxed. I am curious where we are on the curve.

With transport that point might be when we perceive petrol to be expensive, we limit our travel not because we cannot afford it but because it feels expensive.

Personally I feel I am over the top of it, I spend less on fuel than I did because I think of it as expensive.



so I am trying my first poll

1 I don't consider the price when choosing destinations - would be people on the front half of the curve.

2 I buy what I need and no more, I could spend more but it seems expensive. - Are people on the far side.

 

[finisterre]

 

[nick mercedes]

With transport that point might be when we perceive petrol to be expensive, we limit our travel not because we cannot afford it but because it feels expensive.

People are already having to stay at home due to the cost of a day out.

The great Arab revolt of 2011 was due to:

Rising Prices

Huge gulf between rich and poor.

Corrupt goverments enriching themselves at the cost of everyday people.

A lack of true democracy.

Given that all the above apply to us in the UK, can we revolt too?

 

[snoop51]

Does the price of fuel limit your mobility?


Following on from the fuel thread where it was clear that we pay a fair bit of tax on petrol I was wondering how necessary it is to tax at the rate we do? Is it possible that the quantity of tax raised could be increased by dropping the rate?

From the Laffer curve Laffer curve - Wikipedia, the free encyclopedia

It appears there is a point where tax revenue starts to fade due to people choosing not to bother earning the money to be taxed. I am curious where we are on the curve.

With transport that point might be when we perceive petrol to be expensive, we limit our travel not because we cannot afford it but because it feels expensive.

Personally I feel I am over the top of it, I spend less on fuel than I did because I think of it as expensive.



so I am trying my first poll

1 I don't consider the price when choosing destinations - would be people on the front half of the curve.

2 I buy what I need and no more, I could spend more but it seems expensive. - Are people on the far side.

If I worried that much I'd buy a BMW 320 Efficient Dynamics (if they did a touring version)

 

[finisterre]

Tried a 320d, not much better than a Z4 for the types of journey we regularly undertake. Which of course is based on attitude, not on the actuality. Anyway fun comes first. I am not consistent.

I know I should just get on with it but whenever I consider a few days in Scotland walking it crosses my mind that petrol is pricey, if I work out the price I tend to think, 'yes I can afford that'. But I still go to the Lakes.

I think what makes the difference is not the actual cost but how you feel about it. All the publicity and argy bargy increases the profile without the logical position making much impact.

 

[bpsorrel]

Rising fuel prices forced me into buying diesel cars, something I never thought I'd do! I was always a petrol man, running 4.0 Jags, V6 Alfas, V8 Yank tanks etc etc, but what with the rise in road tax rates for big petrol engines and the ludicrous price of fuel, I can't see me ever going back to refined, free revving petrol engines again.. (unless we move to Russia permanently, where petrol is still around 24 rubles a litre (50p ish)!

 

[Mr E]

I answered "I buy what I need" but would have preferred the opposite to the first option - I do consider this price when looking at destinations. Also depends on who's paying.

Yesterday I had a review meeting with an under-performer at work. 90 miles each way. Work was paying, but I also had in mind the importance of the meeting and it needed to be face-to-face. I have switched other meetings from face-to-face to teleconferences in order to keep an eye on travel costs.

We've also cut down on the number of longer weekend jaunts, and Mrs E has cut down the number of trips to the shops (which is always a good thing).

 

[bpsorrel]

I have switched other meetings from face-to-face to teleconferences in order to keep an eye on travel costs.

Me too. I used to visit my various clients every week for a chin wag, sometimes just courtesy calls as most have been with me so long we're basically mates now, but, these days, we talk mostly by Skype and I call to see them more like once a month. I know I claim the mileage off my income tax, but it still hurts.

 

[verytalldave]

People are already having to stay at home due to the cost of a day out.

The great Arab revolt of 2011 was due to:

Rising Prices

Huge gulf between rich and poor.

Corrupt goverments enriching themselves at the cost of everyday people.

A lack of true democracy.

Given that all the above apply to us in the UK, can we revolt too?

Its not a matter for making glib comments I am afraid.
I think to liken us to any of the middle easern countries currently in conflict is very wrong indeed.
To think that we would be shot and killed en masse by the army on the streets of London or Birmingham if you took part in a demonstration is simply inconcievable in the extreme.

 

[DITTRICH]

I'm not sure about the options above.
"...I buy what I need and no more because it is expensive...". ???
Why would I buy more than I need? I'm perplexed? Do people "collect" fuel?
I do admit that 100$/barrel ... £1.30 is about my limit at present.
Any more than that and I will curtail my activities substantially.
I have already planned to substitute the s124 e300d for the w202 c230k this summer in europe. Over 5,000 miles there are considerable savings to be made albeit travelling more slowly. Maybe fuel will never be cheap again but I've had a good run over the last 12 years and 177k miles.

 

[219]

Most of my non-essential motoring has been cut out - can't remember when I last just went for a drive ( road and traffic conditions are another factor in that - it is no longer the pleasure it used to be ) .

I still won't change my car - I always end up with a headache after so long in a Diesel with the constant drone , even if not obvious at first .

 

[nick mercedes]

To think that we would be shot and killed en masse by the army on the streets of London or Birmingham if you took part in a demonstration is simply inconcievable in the extreme.

Picture of armoured government security vehicle guarding government ministry:

Police armoured vehicle | Flickr - Photo Sharing!

Tripoli or London?

Security forces use violence to put down peaceful protests:

http://i.thisislondon.co.uk/i/pix/2009/06/g20-police-hit-415x342.jpg

Tripoli or London?

 

[finisterre]

I answered "I buy what I need" but would have preferred the opposite to the first option - I do consider this price when looking at destinations.

Sorry about that, it is my first poll, I was thinking about the Laffer Curve when I stuck it together, not the logic.

I will learn, hopefully.

 

[verytalldave]

Picture of armoured government security vehicle guarding government ministry:

Police armoured vehicle | Flickr - Photo Sharing!

Tripoli or London?

Security forces use violence to put down peaceful protests:

http://i.thisislondon.co.uk/i/pix/2009/06/g20-police-hit-415x342.jpg

Tripoli or London?

But my point was that dont go in fear of your life when demonstating in the UK.
You may get a slap on the wrist (metaphorically speaking), but generally, not allot worse. Certainly not mass graves being dug for the bodies of those demonstating.

 

[219]

I used to always fill the tank when I needed fuel .

These days , I tend to just put £50 or £60 in and make that last the week by driving less .

 

[finisterre]

I'm not sure about the options above.
"...I buy what I need and no more because it is expensive...". ???
Why would I buy more than I need? I'm perplexed? Do people "collect" fuel?

I used to drive less than frugally, I am still not good but I am getting better. It is price that has changed my behaviour. I am interested to know how many of us spend less than we might because of a feeling that the price is prohibitive even though our wallets could easily find another tenner.

I was trying to look at it from the chancellor's perspective, the ideal is to get as much revenue as possible while not restricting people's options, business choices and cost, I guess.

Anyway I have quite a nice selection of V-Power samples.

 

[crockers]

I think the adding of VAT after fuel tax has been added is criminal. The fuel tax should be raised (yes I know that annoys you) BUT VAT should be levied at 0%. Therefore there is a stabilisation within the taxation rates.

People are already having to stay at home due to the cost of a day out.

The great Arab revolt of 2011 was due to:

Rising Prices

Huge gulf between rich and poor.

Corrupt goverments enriching themselves at the cost of everyday people.

A lack of true democracy.

Given that all the above apply to us in the UK, can we revolt too?

That is a Fair summary of the problem

I think it goes a lot deeper. I think we need to look at world inflation and how that applies to various peoples around the world.

Chinese - 4.9%, India - over 8%, UK (using RPI) 5.1% and Brazil 6%.
This inflation is especially persistent in food prices.
Wheat $350 a ton - usually $150-200
Corn has almost his $300 compared to its usual rate of $100
Sugar ¢32 a pound up from past trading levels of ¢10-15

In the west we find these prices and those of fuel as "inconvenient" they have some impact on our lives but nothing like that of those in poorer countries. In the Middle East rising food prices are alarming. The Chinese and Indian governments have intervened to keep food prices down and people supplied. the Dictators in the Middle East didn't.
So add this to a country with a young population, fed up with unemployment and no future prospects and the revolutions started.

We don't have these food concerns - but I can't see people sitting back and taking these rises, seeing living standards drop - unless the "perceived" wealthy are seen to "be in this together".

When people starve - they rebel........fingers crossed we never see that here in the EU.

 

[lancebond]

Its not a matter for making glib comments I am afraid.
I think to liken us to any of the middle easern countries currently in conflict is very wrong indeed.
To think that we would be shot and killed en masse by the army on the streets of London or Birmingham if you took part in a demonstration is simply inconcievable in the extreme.

course we wouldn't.


have you ever tried to fire an SA80? we'd have more chance of being hit by a stray meteor.

 

[finisterre]

I think the adding of VAT after fuel tax has been added is criminal. The fuel tax should be raised (yes I know that annoys you) BUT VAT should be levied at 0%. Therefore there is a stabilisation within the taxation rates.

I don't really have a view, I do know that we need to cut the deficit and then some. How it is done is up to the government. I was just pondering whether the fuel duty level is on the healthy side of the curve or if by increasing tax we might see a decrease in revenue. Going by the poll response it seems that we are still okay for a rise but not by a great deal. On the other hand fuel duties trickle down into inflation in lots of ways, I do suspect they will be left alone for a while.

It has to be said that the curve may be very different in shape when applied to transport costs rather than income or capital gains taxes.

I won't be holding my breath for a substantial cut.

 

[snoop51]

course we wouldn't.


have you ever tried to fire an SA80? we'd have more chance of being hit by a stray meteor.

Yes piece of cr*p much preferred the SLR. More accurate + you hit any part of a body and it's falling off. SA80 is like a large gnat bite in comparison to a great white.

Back on subject though. I find myself cruising now at 70 - 75ish whereas I used to cruise at 80 - 85ish. It does make a considerable difference in terms of pressure on the wallet & not that much difference in time taken to arrive at my destination.

@ Finistere "I know I should just get on with it but whenever I consider a few days in Scotland walking it crosses my mind that petrol is pricey, if I work out the price I tend to think, 'yes I can afford that'. But I still go to the Lakes."
I'd go to the lakes anyway less midges, countryside still fantastic and you don't need to buy a badger handbag