Petition forces MPs to debate 40 per cent fuel duty cut

MPs will debate a petition calling for a 40 per cent cut in fuel duty and VAT for a period of two years, after more than 100,000 people signed a petition to support the demand.

The petition, which is hosted on the Parliament website, said that the Government should reduce its fuel tax take to offset fuel price rises since 2020. It was raised last year before the Russian invasion of Ukraine, and before the current record prices for petrol and diesel were set.

However, even then prices were at an eight-year high according to the petitioners, who said: “We believe people may understand to a degree the need for tax following the pandemic; however, prices of £1.50 or more per litre will cancel out any understanding. The Government has the ability to sacrifice some revenue to appease the British public.”

MPs will debate the demands on 23 May, following a survey of petitioners carried out by the parliamentary Petitions Committee, which found that many respondents have to drive for their job or to access essential services. Indeed, 62 per cent said rising costs had a significant effect on their social life, while 38 per cent said it significantly affected their job or business.

A Government response issued ahead of the debate suggests the petition is unlikely to prompt the desired drop in fuel taxes. Focusing on the fact that fuel duty has been frozen for 12 years, the government position appears to be that drivers are “already saving £1,900” on their annual car fuel bills compared with what they might have been paying had a pre-2010 fuel duty escalator remained in place.

On the VAT front, the Government said: “While the rationale of this petition is appreciated, any reform to the current VAT treatment of road fuel would carry a significant cost to the Exchequer, and this should also be seen in the context of the over £50 billion of requests for reliefs from VAT received since the EU referendum. 

“Such costs would have to be balanced by increased taxes elsewhere, increased borrowing or reductions in Government spending. Given this, there are no current plans to change the current VAT treatment of road fuel.”

What measure do you think could help ease rising fuel prices? Let us know in the comments...