It marks the ninth consecutive year that fuel duty will be frozen and will cost the Exchequer £840m in lost revenues for the 2019/20 tax year while saving the average driver a cumulative £1,000 by April 2020 and more than £2,000 for the average van driver, according to government figures.
It follows the announcement earlier this month of the freeze in fuel duty made by the Prime Minister in her speech closing the Conservative Party conference, made in response to conjecture that the Treasury was considering a rise as part of measures to aid increased NHS spending.
Speaking at the time, the chancellor said the freeze had “come at a significant cost to the exchequer”. Earlier this year, he pointed out that the freezes have cost the Exchequer around £46bn in lost revenues through to 2018-19, and a further £38bn will be forgone over the Budget forecast period – twice as much as the funds spent on all NHS nurses and doctors each year.
Other changes saw the chancellor announce that following review, the government will maintain the difference between alternative and main road fuel duty rates until 2032 to support the de-carbonisation of the UK transport sector, subject to review in 2024.
And from 6 April 2019 fuel benefit charges will increase in line with RPI and the van benefit charge will increase in line with CPI.
Confirmation of the fuel duty freeze was generally welcomed. Matt Dyer, managing director of LeasePlan UK, said: “After Theresa May mentioned it in her party conference speech, the Fuel Duty freeze was no surprise – but it was still good to hear it confirmed in the chancellor’s own speech today. However, even with the ongoing freeze, petrol and diesel prices have still risen significantly over the past few years. Perhaps, for his next Budget, the Chancellor might consider cutting Fuel Duty for the first time since 2011.”
And David Brennan, CEO of Nexus Vehicle Rental, added: “For businesses operating fleets, we know this has a huge impact on their bottom line and we’re glad to see the government is acting to protect our transport and logistics sector, heralded as the backbone to our economy.”
And David Brennan, CEO of Nexus Vehicle Rental, added: “For businesses operating fleets, we know this has a huge impact on their bottom line and we’re glad to see the government is acting to protect our transport and logistics sector, heralded as the backbone to our economy.”
However, Howard Cox, founder of the FairFuelUK Campaign – which had been calling for an independent pump price monitoring body, was dismissive of the announcement, saying: “Sadly and true to form, despite the continuing and welcome hold in fuel duty, this Government still does not get it, when it comes to our motoring nation. No necessary cut in duty to stimulate the economy, utter silence on those greedy unchecked oil companies continuing to fleece hard pressed motorists at will, and no incentives to move to practical low emissions solutions to improve our air quality. And if Brexit collapses is there the spectre of crippling tax hikes at the pumps to come. A hollow Budget, from and out of touch Chancellor who’s clueless to what to do with UK roads, public transport and our freedom of mobility.”
“We are not here to declare war on the Treasury, but to many of us it feels like the Treasury, along with the Department for Environment, are waging war on drivers, bikers and anyone who uses a van or lorry. The easiest of targets to fill the coffers at the Treasury.”
