Effective November 2008, the initial ruling for the use of red diesel to fuel propulsion and domestic use of motor boats has been to increase to 50.35 pence per liter at 17.5% VAT from the existing 9.64 pence per liter at 5% VAT. This is for the reason that red diesel should be rebated for propulsion and domestic use, which is frequently done, since it is a more polluting type of fuel compared to the commercially-available regular car diesel called Ultra Low Sulphur Diesel (ULSD), thus red diesel should be purchased in exchange for a higher rate of duty.

Yet, before the effectivity date of increasing red diesel’s price, authorities reconsidered the issues presented to them and decided to split the percentage from 100% fuel purchase with zero (0) rebates to 60% fuel purchase with zero (0) rebates and 40% fuel purchase under existing rebate price. As an illustration, a boater who purchases 100 liters of red diesel in November will pay a total amount of 3,823.2 pence. This is computed as the product of 60 liters and 56.94 pence per liter added to the product of 40 liters and 10.17 pence per liter which is equal to 3,823.2 pence.

Aside from the new red diesel deals, determination of red diesel usage will not be considered as a burden for motor boaters. The first ruling about determination of red diesel usage is by enforcing motor boaters to keep all their transaction records which can be mapped in the future whether they use for propulsion and domestic purposes. The new ruling makes it easier by simply requiring motor boaters to sign a declaration for their usage of red diesel and the manufacturer will be the one to make safekeeping of records.