UK Chancellor of the Exchequer Jeremy Hunt has announced a 12-month freeze on fuel duty from April 2023.
The announcement was made as part of Hunt’s Spring Budget, delivered in the House of Commons this afternoon.
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By GlobalDataFuel duty was cut by £0.05 per litre in 2022 after the war in Ukraine caused prices to soar. As part of the 2022 Spring Budget, then-Chancellor Rishi Sunak announced that the cut would remain in place for 12 months. Prior to this, the tax had been frozen at £0.58 per litre since 2011.
This goes against previous predictions made by independent bodies. In November 2022, the Office for Budget Responsibility predicted a 23% rise in fuel duty would take effect in April 2023. This rise would have amounted to a £0.12 per litre-increase in the duty.
According to RAC Fuel Watch, average fuel prices currently sit at £1.47 per litre for unleaded petrol and £1.66 per litre for diesel.
Announcing the change/freeze, Hunt said: “I have heard the representations […] of the impact on motorists of the planned 11p rise in fuel duty. Because inflation remains high, I have decided now is not the right time to uprate fuel duty with inflation or increase the duty.
“For a further 12 months, I am going to maintain the 5p cut, and I am going to freeze fuel duty too. That saves the average driver £100 next year, and around £200 since the 5p cut was introduced.”
The move has been met with a mixed response. Craig Mackinlay, Conservative MP for South Thanet, tweeted his approval of the freeze.
.#Budget2023 pleased that #FuelDuty frozen & 5p reduction continues. Great to have a mention by @Jeremy_Hunt #Chancellor who also gives credit to #Fairfuel (@HowardCCox), @pritipatel & Jonathan Gullis.
— Craig Mackinlay MP (@cmackinlay) March 15, 2023
However, some are critical, including economist Paul Johnson, who raised concerns about the potential cost to the government at a time of shortages.
Recall that the government has spent months saying it can’t find any money to prevent nurses and teachers getting very big pay cuts. He just found £6 billion to cut fuel duties. That’s a choice.
— Paul Johnson (@PJTheEconomist) March 15, 2023
