AA calls for fuel duty cut to be extended
Chancellor Jeremy Hunt is being urged to extend the 5p cut in fuel duty amid the “nightmare” of high costs for motorists.
The AA said when then-chancellor Rishi Sunak announced earlier this year that the 5p fuel duty cut represented the biggest cut ever, it was set to remain in place until March 2023.
The motoring organisation is pushing for the reduction to be extended beyond March due to the continued high pump prices and the cost-of-living crisis.
The AA said that with petrol now in the region of 165p a litre and diesel close to 190p, this compares with 167.3p and 179.7p a litre just before the fuel duty cut.
Petrol, even with 5p off fuel duty, is close to where it was when Mr Sunak decided to act, and diesel is “even more of a nightmare” for drivers and businesses, said the AA.
AA research shows that surging electricity prices are a factor in deterring or delaying more than 70% of drivers from going electric.
Thousands have been forced to give up their cars because of multiple national and local taxes, and the high cost of fuel also means most drivers are cutting back on journeys, other household expenditure or both, the organisation said.
AA president Edmund King, speaking ahead of next week’s Autumn Statement, said: “Any increase in fuel duty would hit households and businesses and just further fuel inflation.
“The 5p cut in duty should not be removed in March, especially if fuel prices remain high as the Treasury benefits from VAT on higher fuel prices.
“On expenditure we have asked the Chancellor not to skimp on road maintenance funding as it is the number one concern for drivers and defective, potholed roads cause extensive damage and can be fatal for those on two wheels.”
A Treasury spokesperson said: “Countries around the world are facing rising global energy prices driven by Putin’s illegal war in Ukraine, and we know this is affecting people here in the UK.
“That is why to help alleviate pressures faced by drivers, we introduced the biggest ever cash-terms cut to fuel duty until March 2023.
“And to help people manage other household costs we are reforming national insurance to put £500 on average back into the pockets of 30 million people and saving the typical household £700 this winter through the Energy Price Guarantee.”
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Five bloody pence!! Most people would think twice about picking up a 5p piece if we dropped it on the floor!! It’s nothing!!
There’s a major flaw in subsidising energy cost from the productive economy….it’s like pushing water uphill…or creating perpetual motion….you are going to fail profoundly in the end. The fact that taxes are increasing to fund the subsidy in transport fuel /home/ business energy costs is exactly that. You can subsidise critical resources and other aspects of the productive economy from cheap abundant energy but not the other way about. Unfortunately for us, few if any politicians understand this limitation….probably because very few studied STEM degrees. Almost all are Humanities graduates.