The Chancellor of the Exchequer Phillip Hammond has been criticised after hinting that the eight-year freeze on fuel duty could end amid petrol prices being at a four-year high.
The Chancellor said on Tuesday that keeping fuel duty at its current level could cost up to £38 million for the rest of Parliament, with extra money raised from an increase in fuel duty expected to be used to fund the NHS.
However, motoring groups have blasted the proposals, with the RAC saying that motorists are already paying their “fair share” in tax.
Nicholas Lyes, RAC head of roads policy, said: “Motorists contribute around £46bn of motoring-related taxation to the Treasury each year so pay their fair share in tax. Pump prices are now at their highest level in four years, so we’d argue that this is not the time to be considering a fuel duty rise.
“It is also important to note that the Treasury has been benefiting from the additional VAT drivers are having to pay as a result of higher fuel prices.”
Fuel duty has been kept at 57.95p since 2011 for both petrol and diesel, with key campaign groups, such as FairFuel UK, being instrumental to freezing the tax on fuel. In the last budget Hammond said that freezing duty would save drivers around £160 a year on average.
According to Petrol Prices, the current average price for unleaded is 131.1p, with diesel costing an average of 134.2p across the UK.
Further fears have also been expressed about the merger between Asda and Sainsbury’s, with both supermarkets having large fuel operations. A merger between the two companies would give the joint firm the largest market share of all petrol and diesel retailers – even more than standard fuel retailers, such as BP or Shell.
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