Government under pressure to postpone planned 2p a litre fuel tax hike
20 March 2009

The UK government is under pressure to postpone a proposed 2p per litre fuel tax hike planned for 1 April.

The price hike has been postponed since last April, but reports suggest chancellor of the exchequer Alistair Darling is under pressure to implement the rise to raise funds.

"If the Government goes ahead with its fuel duty hike then it is conveniently forgetting that drivers also face the threat of severe financial hardship from the credit crunch,” said AA president Edmund King.

"Many still can't understand why, even with a 30 per cent loss in the value of the pound against the dollar, petrol is 90p a litre with oil at 45 dollars a barrel. In March 2007, the last time UK petrol cost 90p a litre, oil was priced at 68 dollars."

The last fuel tax rise was in December, when 2p was added to a litre of fuel to compensate for the drop in VAT from 17.5 per cent to 15 per cent.

If the rise goes ahead it means taxes will account for 71 per cent of the cost of fuel.

Anand Mohan

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