Chancellor's 5p fuel duty cut 'wiped out' as costs at the pump soar

Rishi Sunak has been urged to further cut the rate of duty.

Chancellor’s 5p fuel duty cut ‘wiped out’ as costs at the pump soar Flickr
Rishi Sunak announced the move to cut fuel duty during his spring statement earlier this year.

Rishi Sunak’s 5p fuel duty cut has been effectively “wiped out” due to soaring costs at petrol stations, figures suggest.

The Chancellor announced the move to cut fuel duty in his spring statement earlier this year.

However, according to the RAC’s fuel tracker, the cut has essentially negated by rising fuel costs.

The tracker indicates that on March 22 – one day before Sunak’s statement – unleaded stood at 167.30 pence per litre, and was expected to fall.

Similarly, super unleaded was at 179.28 pence per litre and expected to fall, while diesel was at 179.72 pence per litre with no change expected.

But as of May 12, the cost of unleaded is at 165.62 pence per litre and is expected to rise.

Super unleaded is at 178.47 pence per litre and diesel is at 179.89 pence per litre, with both also expected to rise.

Steve Gooding, director of the RAC Foundation, said: “As we feared, it didn’t take long for the 5p reprieve to be swallowed up by global events which are driving pump prices back towards record levels.

“The Chancellor can’t be blamed for the soaring cost of oil but he could and should go further in cutting the rate of duty.

“Whilst all the attention is on the price of a barrel of Brent crude, the Chancellor continues to quietly take in taxation only just less than 50% of everything that drivers pay on the forecourt.

“There has been a lot of criticism of the windfall profits being made by companies like BP and Shell, but let’s not forget that record oil prices are also bringing in extra for the Treasury in the form of VAT which is levied not just on the product price of petrol and diesel, but also the duty element.”

AA fuel price spokesman Luke Bosdet warned that record pump prices could also impact on families when they get a delivery or need a repair person.

“Diesel is the workhorse fuel that drives haulage. These record prices will be passed on to customers and will drive inflation for goods and services,” he said.

“Record pump prices not only hit families at the pump but also when they shop, get a delivery or call out a repair person.”

SNP MSP Michelle Thomson insisted it is time for the Chancellor to “wake up” to the realities of the cost of living crisis.

“Rishi Sunak’s pitiful 5p cut in fuel duty has been pretty much wiped out due to the cost of living crisis, which was made by the Tories in the first place,” she said.

“This just shows how woeful the measures were that the Chancellor brought in and how they have provided next to no help for families who are struggling to make ends meet.

“It is about time the Chancellor woke up to the realities of the cost of living crisis and provided real help for people across Scotland.

“This once again shows that the only way we can build a fairer, more equal Scotland is with the full range of powers that independence would bring.”