Hopes of cheaper petrol dashed as Osborne sticks to rise in fuel duty

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Drivers had their hopes of avoiding another petrol pump increase later this year dashed by Chancellor George Osborne.

Motorists had wanted Mr Osborne to defer the planned August fuel duty rise in the Budget.

But he said there would be no change to existing fuel duty plans.

He added that vehicle excise duty (VED) would rise by the rate of inflation, although it would be frozen for hauliers.

Road users are already paying record petrol and diesel prices and the announcement from Mr Osborne was greeted with dismay by motoring groups.

AA president Edmund King said: “At a time of record prices at the pumps the August increase in duty is a budget blow-out which will force drivers off the road and could bring a summer of discontent for many.

“We have heard much about tax allowances but the increase in fuel duty makes no allowance for car-dependent, rural and disabled drivers.

“Only last week the Prime Minister told American students that UK fuel prices would make them ‘faint’, yet the Government seems intent on inflicting more pain for no gain on drivers.

“Ironically such a hike in duty doesn’t necessarily help Government finances as people will cut spending at the pumps and in shops, and it could fuel inflation.”

Professor Stephen Glaister, director of the RAC Foundation, said: “George Osborne said that taxes should be fair, simple, predictable and support work. Motoring tax fails on at least three of these measures and it is time for a review of exactly what fuel duty is for and who it impacts most.”

Petrol now averages 139.67p a litre, with diesel at 146.39p a litre.

The August rise, including VAT, will put another 3.62p a litre on prices at the pumps.

Quentin Willson, national spokesman for FairFuelUK, said: “The Government has turned its back on families and businesses all across the country – three-quarters of the electorate who want lower fuel prices.”