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Budget 2020: Freeze on fuel duty continues

By Neil Lancefield, PA Transport Correspondent

Fuel duty will remain frozen for another year, the Chancellor has announced.

In delivering his first Budget, Rishi Sunak revealed that the rate will remain at 58p per litre for petrol and diesel.

He told the Commons: “I have heard representations that after nine years of being frozen, at a cost of £110 billion to the taxpayer, we can no longer afford to freeze fuel duty.

“I’m certainly mindful of the fiscal cost and the environmental impacts.

“But I’m taking considerable steps in this Budget to incentivise cleaner forms of transportation, and many people still rely on their cars.

“So I’m pleased to announce today that for another year fuel duty will remain frozen. Compared to 2010 plans, that’s a saving of £1,200.”

Fuel duty has been frozen since March 2011.

AA president Edmund King said: “We are pleased the Chancellor has listened to our calls to maintain the freeze in fuel duty. An increase would have had a negative impact on both households and business at a time when the economy is fragile given the current circumstances.”

Nicholas Lyes, head of policy at automotive services firm RAC, said: “We welcome the Chancellor’s freeze in fuel duty which will be a relief to drivers up and down the country.

“While the Chancellor might have been tempted to increase duty, the reality is that for millions this would have simply increased their everyday driving costs and done nothing to encourage them to switch to cleaner vehicles.

“And while many want to seek alternative transport options to using their vehicles for some journeys, in so many parts of the country reasonable public transport provision simply does not exist.”

Steve Gooding, director of motoring research charity RAC Foundation, said: “The Chancellor clearly recognised that the coronavirus is creating unprecedented health and economic uncertainties, and that because transport is the single biggest area of household expenditure, any move to increase this burden would hit drivers’ wallets hard, especially those on lower incomes.”

Environmental groups had urged the Chancellor to increase fuel duty to show the Government was serious about tackling climate change.