Fuel duty scrapped 2012 update
Posted on the 6th Dec 2012 in the category Fuel News
Both companies and consumers will benefit from the Chancellor's decision to scrap the planned increase in fuel duty.
During his Autumn statement, Chancellor George Osborne announced to parliament that the 3.02 pence per litre fuel duty increase, due to take effect on 1st January 2013, will be cancelled and the increase that was planned for 1st April 2013 will be deferred until 1st September 2013.
Such a move could see the typical driver save £40 a year and hauliers £1,200 a year. Confused.com insurance boffin, Gareth Kloet, added "it is a relief for all motorists, including those who rely on the roads to keep their businesses up and running".
In the financial year 2011-12, £26.8bn was received from fuel duty by the Treasury, which was a decline in revenue from the previous year where it peaked at £27.26bn. Since the duty peak, 527 million fewer litres of petrol and diesel were sold, as individuals and companies chose to economise, according to Edmund King, president of the Automobile Association.
"The tax take from fuel duty is pretty healthy and would be even better were it not for record fuel prices," he said.
"Arguably, the government would rake in more revenue if it tackled the causes of stubbornly-high fuel prices in the UK, allowing cash-tight businesses, lower-income families and the 28% who restrict their spend on fuel.
Fuel duty has not increased since January 2011, when a 0.76p per litre was imposed and it was then cut by 1p in March 2011 and ever since planned increases have been postponed repeatedly, before finally being scrapped altogether.
George Osborne stated "Under this government we'll have had no increase in petrol taxes for nearly two and a half years - in fact they have been cut,"
"Fuel is 10p per litre cheaper than it would have been if we had stuck to the Labour tax plans and I want to keep it that way."
Fuel duty increases since 2001:
Source: RAC Foundation
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