Motorists facing record increase in petrol costs as fuel duty soars

Autumn Statement: Key announcements from Jeremy Hunt

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British motorists are facing a “record cash” increase to the cost of fuel, as fuel duty is set to soar from March. The Office for Budget Responsibility has predicted that fuel duty will increase by 23 percent, the OBR predicted. The change was not mentioned in Mr Hunt’s Autumn statement.

The OBR’s Economic and Fiscal Outlook, published earlier today, said the change would raise the price of petrol and diesel by around 12 pence a litre.

It described it as a “record cash increase”.

While the Chancellor confirmed that electric cars would become subject to vehicle excise duty today in his statement, he did not announce any plans to hike fuel duty.

The fuel duty tax has been frozen at 57.95p for every litre since March 2011.

But on March 23, 2022, Sunak announced that it would be cut by 5p per litre.

However, the 12-month measure only lasts until the end of March.

Earlier today, 24 MPs – including formed Home Secretary Priti PAtel – wrote a letter to Mr Hunt urging him to cut fuel duty.

They said: “My fellow MPs and I want to see fuel duty cut to stimulate growth.

“We have seen record high prices in filling up at the pumps in the last 12 months, and despite a strengthening pound and significant wholesale falls in recent weeks, petrol is still 22p/litre higher than back in January.”

The Chancellor announced a £55billion plan for tax hikes and public spending cuts in his Autumn Statement in the House of Commons this morning.

Mr Hunt’s package included around £30billion in spending cuts and £24billion in tax rises over the next five years.

He announced that the threshold for paying the 45p rate of tax would be reduced from £150,000 to £125,140 from 6 April 2023.

Meanwhile, the income tax personal allowance, higher rate threshold, main national insurance thresholds and inheritance tax thresholds will be frozen until April 2028.

This will mean that more Britons are likely to end up with more tax, as they will be dragged into higher bands as a result of soaring inflation.

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Mr Hunt also announced a new windfall tax on energy firms, which will be used to help pay for Government support for household energy bills.

Despite previous Government objections to a windfall tax, Mr Hunt told the Commons: “I have no objection to windfall taxes if they are genuinely about windfall profits caused by unexpected increases in energy prices.

Mr Hunt acnowledged that his statement included “difficult decisions” but said the plan would “strengthen our public finances, bring down inflation and protect jobs.”

A Downing Street Official said that inflation is the “single biggest barrier to growth”.

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