RHA reaction to Chancellors Budget

The Road Haulage Association has responded to the Chancellor's Budget with significant concerns about measures that will increase costs for our sector. While welcoming specific investments in infrastructure and planning reform, the RHA warns that planned fuel duty increases, higher employment costs, and changes to business rates will place substantial pressure on an industry already operating on razor-thin margins


Fuel duty. The Chancellor’s decision to reverse the 5p cut on fuel duty after September 2026 and the increase of fuel duty rates in line with inflation from April 2027 will be a hammer blow for many small businesses, pushing up the cost of living for families across the country.

Whilst we welcome today’s decision to continue the freeze on fuel duty until next September, as independent economic research shows, a 5p rise in fuel duty would increase household living costs by £1.9bn per annum, pushing up the price of everyday essentials.

Fuel duty is currently planned to increase by 1p from 1 September 2026, 2p from 1 December 2026, and a final 2p from 1 March 2027, reversing the 5p cut made in 2022.

We will continue to urge the Government to rethink these fuel duty increases which loom large for households struggling with the cost of living and for the many small businesses who keep our supply chains moving.

The increase in employment costs from the National Living Wage and minimum wage will continue to heap pressure on the costs for entry level roles and will also cause a ripple effect for those just above these salary levels where businesses need to maintain salary structures. Road transport businesses will have to accommodate the increase against a challenging economic backdrop and wafer-thin margins – an average of 1.58% - leading to lower investment and fewer opportunities for young people. Making employment more expensive risks deepening the jobs crisis among young people.

The introduction of National Insurance payments on pension contributions above £2,000 per annum made via salary sacrifice from 6 April 2029 will also add pressure on small businesses.

Business rates. We are deeply concerned that the government have committed to a new high-value business rates multiplier for properties with rateable values of £500,000. This will set the multiplier 2.8p above the national standard multiplier from April next year.

Though this is aimed at large multinationals, it will have the unintended consequence of dragging large warehouses across the country into a new rate, driving up inflation.

Logistics premises require a larger footprint but offer a relatively low return on land values. The proposed changes will result in higher prices for the transportation of goods.

Capital Allowances. A new 40% First Year Allowance for main rate expenditure from January 2026 will support new investment in businesses that do not qualify for the full expensing relief such as those with leased assets. This will provide welcome support to a section of the freight and transport industry that has so far not been able to take advantage of this tax benefit.

The HGV Levy and Vehicle Excise Duty will both increase by inflation from April 2026. With near record insolvencies in the sector, this will continue to add pressure on operators. This is a disappointing change, which the RHA has campaigned against.

Energy costs. Businesses and households will welcome the help with their energy costs through the end of the Energy Company Obligation in March 2026. Investment in our energy infrastructure that removes our dependency on volatile gas prices is welcome but should be accelerated so that costs for hard-pressed transport operators come down.

Infrastructure. Further funding for the Lower Thames Crossing - £891m announced today – is welcome and is an important step in progressing this vital project which will deliver significant benefits, reducing congestion, boosting trade and supporting economic growth.

We welcome the commitment to spend £2 billion annually for local authorities to repair potholes on their roads by 2029-30.

Planning reforms. The Budget confirmed some significant reforms and investment designed to help improve the pace of our planning system. £48m has been allocated to increase planning capacity, including the hiring of 350 new planners across the country. Measures to streamline the infrastructure planning process through shortening pre-application engagement for major infrastructure projects will also speed up delivery. This will help the essential infrastructure HGV, coach and van businesses rely on to get built more quickly.

Windsor Framework. We welcome the funding £16.55 million over three years from 2026-27 to boost trade between Northern Ireland and Great Britain to help businesses navigate the Windsor Framework. We await more details on what this will mean in practice for hauliers and urge the Government to learn lessons from the inefficiencies of the Trader Support Service, as set out in Murphy Review.

Tourism levy. We note that the Government have confirmed their intention to give Mayors the option to introduce a visitor levy on overnight visitor accommodation

Domestic coach tourism is one of the cleanest and most cost-effective parts of the visitor economy, good for the environment and good for economic growth. Therefore, we believe that Tourism levy funds should be invested in strengthening local tourism.