Petrol to rise despite duty freeze

Petrol prices will rise despite no new fuel duty rises in the Budget, the AA warns
12 April 2012

Drivers have been spared any new petrol pump price pain in the Budget but motoring groups warned of further rises to come.

Although Chancellor George Osborne ruled out any fuel duty increases in his first Budget statement to the Commons, motorists will still face earlier-announced rises of 1p a litre in October and 0.76p a litre in January 2011.

And with VAT due to rise to 20% in January, new year pump prices will go up even further.

Motorists will also be hit by a rise in insurance premium tax.

AA president Edmund King said: "There is some relief that there is not going to be more punishment at the pumps but motorists will face a double whammy in the new year.

"We estimate that taking all the increases into account, motorists will, by January, be paying 4.63p a litre more for petrol and 4.68p a litre more for diesel than they are now."

Britain's drinkers have also been given a reason to raise their glasses as Mr Osborne promised not to raise duties on alcohol. The Chancellor said taxes on tobacco will also remain the same following the "substantial increases" announced in March.

He also scrapped Labour's controversial plan to increase the duty on cider by 10%, saying this would come "just in time to celebrate England's progress to the quarter finals - or else to drown our sorrows".

The moves will be welcomed by campaign groups who slammed the previous government for "piling misery" on struggling pubs.

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