Claims that introducing a fuel duty stabiliser would be too complicated are a myth, the Federation of Small Businesses (FSB) has argued.
Critics of a stabiliser, which would adjust fuel prices in order to alleviate the impact of oil price rises on pump prices, have said that the system would too difficult to be workable.
However, the FSB has countered by saying that it can be simple and affordable.
Basing the stabiliser on the oil price cycle would enable the level of fuel duty to be calculated against a trend price for oil. This would then be adjusted at regularly timed intervals following changes in the oil price cycle, the FSB report claimed.
Setting the level of the stabiliser would, therefore, be straightforward: fuel duty would be X pence per litre minus a proportion of the difference between the current oil and trend oil price.
A fuel duty stabiliser would also provide greater certainty for businesses by introducing an element of consistency, helping them to factor in fuel costs as they plan for the future.
FSB research has shown that the rise in fuel duty and uncertainty over fuel prices will have a significant impact on small businesses leading them to increase prices, freeze pay or even lay-off staff.
John Walker, the FSB’s national chairman, commented: “Critics have said that the fuel duty stabiliser is too difficult to introduce. The FSB does not agree. We know that high fuel prices are having a huge impact on our members, hampering growth and in turn the economy at large. It is vital we see action now.
“A fuel duty stabiliser would give the UK’s five million small businesses the certainty and stability they need to factor in fuel costs to their business plans. It is unacceptable that the Government has not delivered on its pledge and now says it is too complex. A fuel duty stabiliser can be easily introduced and must be put in place. Without it, small firms are just going to be left simply trying to survive.”
