All costs and benefits should be quoted in market prices (see Appraisal Parameters Section 9.5.6). The market price values of time for working time include a mark up for indirect taxes of 20.9%, which is equivalent to the average rate of indirect taxation in the UK economy. For non-working time, the benefit is perceived by the individual and is therefore inclusive of indirect tax. These market price values should be used as set out in Section 9.5.6.
In disaggregating the impacts upon user groups, allocations of financial impacts between Government and others is required. For example, a saving in fuel costs for drivers should be valued at current market prices (i.e. including fuel duty), but on the other side of the equation the loss of tax revenue to Government needs to be taken into account. Practitioners should refer to Section 12 - Costs to Government.
