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Fuel duty hike warning: Tax rise set for in just weeks sparks fury

Fuel duty: A tax rise on fuel could hit driver in just a few weeks
Joe Giddens
Georgina Cutler

By Georgina Cutler


Published: 08/02/2023

- 09:42

Around 37 million UK motorists remain one of the highest taxed drivers in the world

Jeremy Hunt and Rishi Sunak are facing demands to commit to freezing fuel duty, with Tory MPs warning against hiking up the tax.

Backbenchers have warned that if the Chancellor and Prime Minister don’t commit to freezing fuel duty then rates could rise by 23 per cent.

Tory MPs Priti Patel and Jonathan Gullis are demanding more regulation on fuel and the Government to restrict any further increases on fuel duty .

According to a report from the Centre for Economics and Business Research (CEBR), a hike on rates could add 2.3 per cent to inflation, hold GDP down by one per cent and put 31,000 jobs at risk.

Home Secretary Suella Braverman making a statement to MPs in the House of Commons, London. Ms Braverman has said she is %22committed%22 to making the plan to send migrants to Rwanda work after the High Court ruled that the policy is lawful. Several challenges were brought against the proposals announced by then-home secretary Priti Patel in April, which she described as a %22world-first agreement%22 with the east African nation in a bid to deter migrants from crossing the Channel. Picture date: Monday December 19, 2022.
Priti Patel is calling for the government to freeze fuel duty
House of Commons

Surging fuel prices and rising inflation was partially caused by Russia’s invasion of Ukraine last year.

“We are campaigning with Howard Cox for PumpWatch – a regulator, with legislative powers, to ensure motorists are not exploited,” Priti Patel and Jonathan Gullis wrote in the Daily Express.

“Most importantly, they will ensure there is fairness and transparency, putting the 37 million motorists in this country first.

“We have written to both HM Treasury and the Department for Business, Energy and Industrial Strategy outlining the proposals, and we are pleased to have the support of over 30 MPs.”

Between October 10 and December 8, 2022 petrol prices fell by just three per cent while the wholesale petrol price dropped by 22 per cent.

And despite diesel prices scarcely decreasing at the pumps, wholesale prices have plunged by 25 per cent.

Overall, the price differential between petrol and diesel jumped a huge 400 per cent.

In the last six months retail petrol has fallen 25 per cent yet its wholesale price dropped more by 41 per cent.

Conservative MP Jonathan Gullis after putting on a jacket, he had been set to address the Commons from home during a debate on support for businesses and individuals during the Covid-19 pandemic but was snubbed from making a virtual contribution to Parliament after being judged to be dressed too casually. Picture date: Tuesday February 23, 2021.
Jonathan Gullis is campaigning for more regulation on fuel companies
House of Commons

If pump prices had fallen at the same rate as wholesale levels petrol would be at the pumps 10p to 14p lower and diesel 20p lower.

From 2015 up until 2020 average profit per litre for petrol and diesel was around 8 to 9p.

However, from 2020 petrol profit has doubled to around 19p per litre and diesel has more than doubled to 24p per litre.

Next year, Shell is expected to announce a record $40billion net profit for 2022.

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