Fuel duty for petrol and diesel cut by 5 pence per litre Rishi Sunak announces
The Chancellor of the Exchequer Rishi Sunak has announced that fuel duty for petrol and diesel has been cut by 5 pence per litre across the whole of the UK.
The Government has said that overall this is the biggest cut, in cash terms, that has ever been applied across all fuel duty rates at once.
This cut, plus the freeze in fuel duty in 2022-23, represents a £5 billion saving over the next 12-months worth around:
£100 for the average car driver
£200 for the average van driver
£1,500 for the average haulier.
Why the Government are doing it
Unique circumstances globally, including the war in Ukraine, have pushed pump prices up to unprecedented levels. The Government say they are taking action to “protect all motorists including parents driving their children to school; small businesses completing home deliveries; and hauliers that are critical to supply chains across the country”.
This is not only the first cut to main rates of fuel duty in over a decade, it is also the biggest cut in cash terms that has ever been applied across all fuel duty rates at once.
The last cut across main fuel duty rates was in 2011, with reductions of 1p to the rates for petrol and diesel and proportionately smaller reductions to lower fuel duty rates.
The Chancellor announced at Autumn Budget 2021 that fuel duty rates would remain frozen in 2022-23 - this was the twelfth consecutive year of the freeze. But now the Government say they are “going even further to help people with the rising cost of living”.
When is it happening?
This cut took effect from 6pm today (23 March 2022) and will last for a full 12 months - balancing providing short term support with the long-term sustainability of the public finances.
Who will benefit?
The Government say that cutting fuel duty will benefit anyone across the UK who uses fuel and represents savings for consumers worth around £2.4 billion over the next 12 months. Compared to uprating fuel duty in 2022-23, cutting fuel duty to this level delivers savings for consumers worth over £5 billion over the next year, the UK Government claims.
Howard Cox, Founder of the FairFuelUK Campaign, has spoken out and praised the decision: “It would be churlish not to be thankful to the Chancellor in cutting Fuel Duty by 5p for 12 months. Well done Rishi! Our relentless campaigning has been fruitful. It will give some respite to millions of motorists, that have had and continue to have no choice but to drive. Just as important this fiscal relief to hauliers and small businesses teetering on survival, desperately need this reduction more than most road users, it’s way overdue.
“It will only benefit drivers and the economy if the new fuel taxation level becomes permanent and is accompanied by the introduction of an independent pump pricing watchdog, we’ve notionally called PumpWatch. Today’s fuel duty reduction must be passed onto drivers immediately. PumpWatch is the ideal vehicle to make that happen and to stop the perennial fleecing of drivers by businesses and speculators further up the fuel supply chain. Please meet with FairFuelUK, Chancellor to discuss the way forward, we want to help. Use us please."
