Sheffield’s nearest rival Chamber attracted 116 signatures to the national letter, but the Chambers are all united in voicing their opposition to the increase, which is scheduled for April.

The Government plans an increase of 2p per litre on fuel duty, which Chamber members, especially hauliers and road dependent businesses claim could cost the haulage industry an estimated £170 million.*

The letter states that the impact of the decision will severely damage the UK's haulage industry, which is already battling against high oil prices and a duty rise from last October.

It goes on to say that in order to remain competitive, Chambers and their members would welcome the opportunity of working with Government in developing "an alternative pricing system which separates the way fuel tax is levied for cars as opposed to commercial vehicles."

Commenting on the planned increase, Sheffield Chamber policy and representation manager Helen Rana said: "The message being sent from Government to our logistics industry is particularly worrying, and it’s clear from Sheffield Chamber members’ record response that this is not just a national issue – it is potentially a huge concern for members across our city business region.

“This issue has motivated scores of our members to add their voice to the debate and we now hope the opposition of large numbers of Chamber members across Britain will encourage further discussion.”

David Frost, director general of the British Chambers of Commerce, said: "The government must urgently reconsider this unnecessary rise in fuel tax to protect hauliers and businesses that use the roads on a daily basis. This is yet another tax on business which further erodes our international competitiveness."

Hauliers have calculated that April's tax hike, which looks set to be followed by yet another in 2009, would add an extra £15,000 in costs per vehicle per 100,000 miles on the road.*

The full text of the letter is:

Dear Chancellor,
We the undersigned are calling on the Government to reconsider the 2p increase on fuel duty due to come into effect in April. This rise will have a particularly damaging impact on our members in the haulage industry.

With the price of oil hovering around the $100 dollar barrel mark, British hauliers are finding it increasingly difficult to compete with their European competitors due to the high taxes levied on fuel in the UK. The new rise will only compound the problems, with many smaller hauliers likely to be the worst hit as they will find it difficult to pass on the extra cost to customers.

The logistics industry is critical to the UK economy yet the tax system is making British hauliers uncompetitive. We are alarmed by the signals that the Government appears to be sending to such a crucial industry at a time when the economy appears to be stalling.

As an immediate measure we urge you to scrap the 2p increase scheduled for this April. In the longer-term we would welcome the opportunity to work with you to develop an alternative pricing system which separates the way fuel tax is levied for cars as opposed to commercial vehicles to help the UK haulage industry remain competitive.

Yours sincerely,

* Calculations from the Freight Transport Association (FTA)