Upgrade Now

Chancellor freezes fuel duty

By Michael Millar

Date: Tuesday 26 Jun 2012

Chancellor freezes fuel duty

Chancellor George Osborne has announced the government will not go ahead with a three pence-a-litre rise in fuel duty due in August.

He had been under pressure from MP's on all sides, with Labour's Ed Balls last night calling on Conservatives to join Labour in voting against it in the House of Commons next week.

Motoring groups had also complained that the rise, which the Chancellor refused to rule out in March's Budget, would damage the economy.

Osborne told MPs fuel duty would now be frozen for the rest of the year.

The move would be paid for through departmental under-spend, the Treasury said, citing predictions by the Office for Budget Responsibility that there would be £4bn left in the coffers in 2011/12.

The government was "doing everything we can in very, very difficult economic circumstances" to help consumers and businesses, the Chancellor said.

John Walker, National Chairman of the Federation of Small Businesses, said a duty rise in August would have damaged small firms that are already being crippled by the high cost of petrol.

"We would urge the Government to now put a fuel duty stabiliser in place to remove the volatility of fuel prices and help small businesses plan ahead," he said.

Professor Stephen Glaister, Director of the RAC Foundation, said given that tax made up around 60% of the pump price, falls in the price of oil where only ever going to go so far in easing the financial burden on motorists.

"Road transport powers the nation’s economy and it is welcome that the Chancellor recognises the huge pressures the country’s 35m drivers are under with transport being the biggest single area of household expenditure bar none," he said.

« Go back to news channel

..

Email this article to a friend

or share it with one of these popular networks:


Top of Page