Transport & Car Blog

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Fuel duty 2014 plans frozen

  Monday, 9 December 2013

Chancellor of the Exchequer, George Osborne, has announced that fuel duty has been frozen until May 2015, in a move that will strongly appease motorists.

Mr Osborne first suggested this idea in September and will now maintain fuel duty at its current rate of 57.95 pence per litre, the same level it has been since March 2011. Duty will now be frozen until May 2015, for the remainder of the current parliament.

“I said earlier this autumn that if we could find the money, I’d like to go on freezing duty,” said Mr Osborne.

“Today I can report that because we have taken difficult decisions to control the public finances, I can deliver on that promise.”

Mr Osborne also claimed that the coalition government has reduced the cost of a tank of fuel by £11, through restriction on the levy, since coming into office in 2010.

The news will be welcomed by motorists who have seen the cost of fuel rise exponentially in recent years. Prof Stephen Glaister, director of the RAC Foundation, said:

“(The news will) be welcomed by 36 million UK drivers, not least the record number of workers who now commute by car, some 17 million in total.

“But 60 per cent of the pump price is still taxation and about 7 per cent of all the chancellor’s income comes from motorists. Whichever way you look at it, drivers are doing more than their fair share to prop up government spending,” he added.

It is hoped that the move will offset highly volatile pump prices which have stricken motorists over the past two years, shooting up by 8p-10p a litre in some cases. Many are wary of oil firms taking advantage of the Chancellor’s generosity by increasing their margins further.

Car sales on the up

The fuel duty freeze comes as this November’s car sales have been the strongest in any November month since 2004, according to figures from SMMT.

Almost 160,000 new cars were registered last month, bringing the total amount of cars sold in 2013 to 2,111,819; 9.9 per cent higher than last year:

“Motorists have bought more than two million cars so far in 2013, a tremendous success for the industry on the back of buoyant consumer confidence and innovative new products,” said Mike Hawes, SMMT Chief Executive.

“With the UK economy looking increasingly positive, we can expect strong underlying demand for new cars to continue into 2014, with volumes set to match or surpass those seen this year,” he added.

The best-selling model continues to be the Ford Fiesta, followed by the Ford Focus, Vauxhall Astra, Vauxhall Corsa and VW Golf. Fleet operators and businesses took the highest proportion of sales, with diesel models more popular than petrol.

Even more positively, ultra-low carbon cars were 23.1 per cent more popular month year-on-year, although they only accounted for 1.5 per cent of all sales.

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