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Jeremy Hunt urged to stop ‘record increase’ in fuel duty from March

fuel duty A woman fuels her car at a petrol station in London January 3, 2011. Britain's road users are facing rises in driving costs due to duty and VAT increases which take effect this week on the sale of fuel. REUTERS/Suzanne Plunkett  (BRITAIN - Tags: BUSINESS ENVIRONMENT POLITICS ENERGY)
Fuel duty might rise by 12 pence per litre in March 2023, according to the Office for Budget Responsibility’s November report. Phoito: Suzanne Plunkett/Reuters

Chancellor Jeremy Hunt is facing backlash after it was revealed that fuel duty is expected to rise by 23% next year, adding 12p a litre to the cost of petrol and diesel.

Hunt made no mention of it during his Autumn statement but the Office for Budget Responsibility (OBR) said it assumed there would be an increase in the spring.

Fuel duty currently stands at 52.95p per litre for petrol and diesel, having been cut by 5p per litre in March 2022.

If the rise goes ahead in late March, it would add £5.7bn to the government’s coffers next year.

“This would be a record increase, and the first time any government has raised fuel duty rates in cash terms since 1 January 2011,” the watchdog said.

Read more: From income tax to pensions: What Jeremy Hunt's Autumn statement means for you

It would be the first time a government has raised fuel duty in cash terms since January 2011.

Pressed on the issue on BBC Breakfast, Hunt said: "Let me clear that up, that is not government policy, we'll make a decision on that at the next budget in the spring.

"That was just an assumption that the OBR made."

RAC fuel spokesman Simon Williams urged Hunt to leave fuel duty “well alone,” arguing it “would force the millions of hard-working people who depend on their cars to spend even more on petrol and diesel, putting even more stress on already-squeezed household budgets”.

He added: “Our analysis shows there is a clear link between inflation and fuel prices. When the prices drivers pay to fill up rise, inflation seems certain to follow. That’s something the chancellor must recognise as he considers what action to take today.

“Last month, the Office for National Statistics stated the single main reason inflation wasn’t higher was because fuel prices had fallen through the summer. Unfortunately, going into the autumn, pump prices have been increasing again, which we fear will only put further upward pressure on the headline inflation rate.”

Read more: Autumn statement: Jeremy Hunt's budget will see millions paying more in tax and energy bills to rise to £3k

Tory MP Jonathan Gullis wrote a letter to the chancellor, calling on him to "listen to motorists, van drivers and truckers, who are already being smacked hard with cripplingly high taxation" and prove to them the government "actually have their backs by keeping the price at the pump down".

Howard Cox, founder of FairFuelUK said: “It would be the economics of the asylum if this ill-informed government whacked more filling up costs in 2023, onto one of the world’s already highest taxed drivers."

The Treasury said a final decision on the rate would not be taken until the next budget in the spring.

Watch: Chancellor says he is 'not guilty' of bottling difficult decisions