Financial Secretary to the Treasury John Healey MP today announced that the UK has submitted its application to the European Commission to retain a derogation that allows for the use of ‘red diesel’ in private pleasure craft. This derogation allows the UK to charge a reduced rate of fuel duty for ‘red diesel’.

Healey said: “We believe that removing this derogation would provide no significant revenue or environmental benefits to the UK, would undermine other EU objectives and could pose significant compliance costs for business and fuel users.

A proposal from the European Commission and unanimous agreement by the EU Council of Ministers is required for the derogation to be retained.