Hiking fuel duty by 5p a litre will make the UK even more of an outlier in Europe, Rachel Reeves has been warned.
New analysis by the TaxPayers’ Alliance shows Britain already has the highest duty on diesel and is ninth highest for petrol, compared with EU countries.
If the Chancellor does not renew a ‘temporary’ 5p cut in fuel duty, which is due to end in March next year, the UK will rise to sixth for petrol.
Fuel duty is currently 52.95p per litre. Drivers in the UK already pay 6p a litre above the EU average on petrol, and 16p a litre more on diesel.
Ms Reeves is considering hiking fuel duty by up to 7p a litre as she scrambles for cash in this month’s Budget.
Rachel Reeves has been warned about raising hiking fuel duty by the Taxpayers’ Alliance
Fuel duty is currently 52.95p per litre. Drivers in the UK already pay 6p a litre above the EU average on petrol, and 16p a litre more on diesel (stock photo)
Ms Reeves is considering hiking fuel duty by up to 7p a litre as she scrambles for cash in this month’s Budget (stock photo)
A 7p rise in fuel duty would add £3.85 to the cost of filling up an average family car – undermining Labour’s claim that it will not impose higher taxes on working people (stock photo)
Whitehall sources said that along with scrapping the 5p cut in fuel duty, the Chancellor is also considering restoring the annual fuel duty rise.
Treasury officials have warned her that she has a ‘now or never’ opportunity to end a freeze that has lasted for 14 years.
John O’Connell, chief executive of the TaxPayers’ Alliance, told the Mail: ‘Motorists will be panicking that 14 years of good work on fuel duty is about to be undone in an afternoon, hitting their wallets at the worst possible time.
‘Even with over a decade of freezes, UK taxes on petrol and diesel remain high by EU standards. Rachel Reeves should slam the brakes on any proposals to hike this tax.’
Meanwhile, an AA survey revealed that as winter approaches, colder conditions could increase driving costs by 20 to 48 per cent if combined with fuel duty increases.
AA President Edmund King told The Sun: ‘Hiking fuel duty at the onset of winter is the worst possible time to do it.
‘It is when cold engines and increased use of heaters, wipers and lights send fuel consumption and costs shooting up.’
Ms Reeves could increase fuel duty in order to fill a £40billion black hole in the country’s finances.
A 7p rise in fuel duty would add £3.85 to the cost of filling up an average family car – undermining Labour’s claim that it will not impose higher taxes on working people.
But ministers believe that, with pump prices at their lowest since Russia’s invasion of Ukraine, they can justify a fresh tax raid. Fuel duty is currently 52.95p per litre.
A group of Conservative MPs, led by Saqib Bhatti and Howard Cox from FairFuelUK, will deliver a petition of 130,000 to Downing Street today demanding the freeze to continue.