Drivers will save ‘£100 next year’ as Jeremy Hunt freezes fuel duty again and keeps 5p cut in first Budget as Chancellor
- Chancellor Jeremy Hunt keeps 5p cut in fuel duty in Budget relief for drivers
- He also announces freeze in fuel duty for the 13th year in a row
Drivers enjoyed a Budget boost after Jeremy Hunt announced he is keeping last year’s 5p cut in fuel duty and abandoning an inflation-linked rise.
The Chancellor told MPs he will save motorists £100 over the next year by freezing fuel duty for the 13th time in a row, as well as maintaining the cut that was introduced 12 months ago.
The move, estimated to cost around £6billion, will ease motorists’ concerns following the volatility in pump prices in the wake of Russia’s invasion of Ukraine.
Mr Hunt had been under pressure from Tory MPs to freeze fuel duty once again, with more than 50 backbenchers having publicly called for action in recent weeks.
Speaking in the House of Commons as he delivered his Budget today, the Chancellor said: ‘Because inflation remains high, I have decided now is not the right time to uprate fuel duty with inflation or increase the duty.
‘So here’s what I am going to do: for a further 12 months I’m going to maintain the 5p cut and I’m going to freeze fuel duty too. That saves the average driver £100 next year and around £200 since the 5p cut was introduced.’
The Chancellor told MPs he will save motorists £100 over the next year by freezing fuel duty for the 13th time in a row, as well as maintaining the cut that was introduced 12 months ago
Ex-Cabinet minister Priti Patel was last week among a group of MPs to deliver a 131,000-signature petition to Downing Street
Ex-Cabinet minister Priti Patel was last week among a group of MPs to deliver a 131,000-signature petition to Downing Street, organised by the FairFuelUK campaign, calling for a cut or freeze in fuel duty.
After the Chancellor’s Budget announcement, Ms Patel said today: ‘This is a great victory for drivers campaigning to keep fuel costs down and families and businesses across the country will welcome the Chancellor’s decision to maintain the freeze on fuel duty.
‘With FairFuelUK we’ve been campaigning to keep fuel costs down to support efforts to curb inflation and to help the economy to grow and I am pleased that the Chancellor has listened.
‘Freezing fuel duty will save businesses thousands of pounds a year and help families every time they fill up their cars.’
Government figures show the average cost of a litre of petrol and diesel at UK forecourts is around £1.47 and £1.67 respectively.
Prices reached record highs of £1.92 for petrol and £1.99 for diesel in July last year, largely due to Russia’s invasion of Ukraine leading to an increase in the cost of oil.
Motorists had been in line for a 12p-per-litre hike in fuel duty without the Chancellor’s intervention, with a 23 per cent increase having been pencilled in for this month.
RAC head of roads policy Nicholas Lyes said: ‘We welcome the Government’s decision to keep the 5p fuel duty cut in place for another 12 months.
‘The cut has given drivers some much-needed relief in what has been the most torrid year ever at the pumps, with price records being broken even after duty was cut.
‘Given the importance of driving for consumers and businesses, duty should be kept low to help fight inflation.’
Howard Cox, the founder of FairFuelUK, described action on fuel duty as ‘the most important help for voters’ amid the cost-of-living crisis.
‘The Treasury knows full well, petrol and especially diesel prices at the pumps, critically affect inflation, logistics, business viability, jobs, and GDP,’ he said.
Mr Hunt’s decision means fuel duty will remain 52.95p per litre for petrol and duty.
Before last year’s cut, it had been frozen at 57.95p since March 2011. VAT is charged at 20% on top of the total price.
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