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AA calling for fuel duty freeze

03/12/12

ROAD FUEL duty taxes are still pouring into the Treasury despite high petrol prices, according to AA figures.

The high tax take should be enough to persuade Chancellor George Osborne to postpone the 3p-a-litre fuel duty rise planned for January, the AA said.

Its figures showed Treasury receipts from fuel duty are on course to match last year's total despite the 20-month freeze on fuel duty.

The AA said that in the financial year 2011/12, Revenue and Customs statistics showed that the Treasury received £26.80 billion from fuel duty.

This was 1.7% below the record of £27.26 billion set the year before and was nearly three times the 1990/91 figure when the Treasury received £9.63 billion from fuel duty.

The AA said that since April 2012, consumers had suffered from two wholesale petrol price bubbles that drove the average UK pump price of petrol to a record of 142.48p a litre in the spring and then 140.23p in the autumn.

Wholesale prices collapsed by the equivalent of 10p a litre (including VAT) after each surge but, a month later on both occasions, average pump prices had fallen only 4p a litre.

The AA said figures for April to October 2012 showed that, compared with the same period last year, 527 million fewer litres of petrol (4.5%) were sold. With duty at 57.95p a litre, the reduction is worth £305.4 million in lost tax.

Despite this, fuel duty receipts so far this financial year are only 1.2% behind where they were a year ago, the AA said.

The growth and resilience of the fuel duty tax take is based largely on the UK's diesel consumption, which fell to 14.81 billion litres between April and October 2009 after the credit crunch but has recovered to 15.41 billion litres over the same period this year.

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