Drivers set to save £50 on fuel as duty cut extended in Spring Budget

Chancellor Jeremy Hunt has confirmed the 5p fuel duty cut will be maintained for a further 12 months. Fuel duty will be frozen and will not increase in line with inflation, he added.

Making the announcement in the House of Commons during Wednesday's Spring Budget statement (March 6), he said the move will save the average car driver £50 next year. Motorists will have saved around £250 since the cut was first implemented in March 2022, he said.

However, experts have said drivers have not "fully benefited" from the 5p cut because retailers have upped their prices to cover rising costs.

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The main rate of fuel duty was cut by one penny at the 2011 Budget to 57.95 pence per litre. It has been frozen since then and was temporarily reduced by 5 pence per litre in both the 2022-23 and 2023-2024 financial year.

Mr Hunt’s decision means fuel duty will remain at 52.95p per litre for petrol and duty. VAT is charged at 20 per cent on top of the total price.

Mr Hunt said: “The shadow chancellor complained about the freeze on fuel duty and Labour has opposed it at every opportunity. The Labour Mayor of London wants to punish motorists even more with his Ulez plans. But lots of families and sole traders depend on their car. If I did nothing fuel duty would increase by 13% this month.”

He added: “I have as a result decided to maintain the 5p cut and freeze fuel duty for a further 12 months. This will save the average car driver £50 next year and bring total savings since the 5p cut was introduced to around £250.

“Taken together with the alcohol duty freeze, this decision also reduces headline inflation by 0.2