The British government has frozen a planned fuel duty rise until the end of the year, in a bid to “protect” drivers from rising pump prices.
Chancellor Rachel Reeves had previously planned to scrap a 5p cut in fuel duty that was introduced in 2022, when the current rate of 52.95p was introduced. It was due to rise by 1p in September, with the full 5p rise happening over the course of the following six months.
But the government now says the full 5p cut will be extended until the end of this year, as part of what it calls a “targeted package” to keep taxes down in response to rising fuel costs due to the war in Iran. The government announced a review of the planned rise back in March.
Prime Minister Keir Starmer said: “I know many are feeling the pressure of energy and fuel costs, and are worried about how the conflict in Iran will affect their finances. Because when global events drive up prices, it’s working people who feel it first.
“That’s why this government is stepping in to keep fuel costs down for millions of drivers and putting money back in the pockets of working people.”
The original 5p cut was introduced in 2022 following Russia’s invasion of Ukraine, but the government announced plans to remove it in last November’s Budget. The plan was that once the 5p cut had been removed, fuel duty would then rise in line with inflation.
The government has also introduced a 12-month road tax holiday for hauliers, who will pay £1 at renewal time, instead of up to £912.
