Logistics UK has urged the Treasury to avoid any hikes in fuel duty, National Insurance contributions or business rates in next month’s Budget, warning that such moves would increase costs across supply chains and worsen inflation. In its submission ahead of the Chancellor’s speech, the organisation said the haulage industry is already under significant financial strain and cannot absorb further tax pressures without harming economic growth.

The logistics sector employs around 2.7 million people—around 8% of the UK workforce—and is still grappling with the impact of rising employer National Insurance costs, estimated to add £1.7 billion to the industry’s bills this year. Acting chief executive Kevin Green said fuel accounts for nearly a third of the operating cost of a 44-tonne HGV, adding that any rise in duty would “do the exact opposite” of bringing inflation down.

Green noted that smaller haulage firms are particularly vulnerable, as they often lack contracts allowing them to pass on higher fuel costs to customers. He also warned that business rates reforms could add “millions” to operators’ expenses, further pushing up consumer prices.

The group called for a balanced approach, urging ministers to protect investment in logistics infrastructure and explore incentives for cleaner fuel alternatives, rather than increasing taxes on essential operations.