Rishi Sunak lowers fuel duty by 5p and cuts National Insurance

Rishi Sunak confirmed on Wednesday (23 March) that he is cutting fuel duty by 5p a litre, in the 'biggest cut to all fuel duty rates ever.' The change, announced as part of the Chancellor's spring statement, comes into place from 6pm on Wednesday evening.

It will last for a whole 12 months until March 2023. According to the RAC, a 5p reduction in fuel duty would make it £3.30 cheaper to fill up an average family car with a 55-litre tank.

Fuel duty is levied per unit of fuel purchased and is included in the price paid for petrol, diesel and other fuels used in vehicles or for heating. The rate depends on the type of fuel and VAT is then added on top.

Read more: How will Rishi Sunak's spring statement affect me? How today's major announcements will hit your bills

Fuel duty has been frozen at 57.95p per litre for petrol and diesel since March 2011. Mr Sunak said the UK Government wanted people to know they will “stand by them” in dealing with rising living costs.

He told MPs: “Today I can announce that for only the second time in 20 years, fuel duty will be cut. Not by one, not even by two, but by 5p per litre. The biggest cut to all fuel duty rates – ever.

“While some have called for the cut to last until August, I have decided it will be in place until March next year – a full 12 months. Together with the freeze, it’s a tax cut this year for hard-working families and businesses worth over £5 billion, and it will take effect from 6pm tonight.”

Just hours before Mr Sunak's statement, it was revealed that petrol and diesel prices in UK forecourts hit yet another new high. Figures from data firm Experian Catalist showed the average cost of a litre of petrol on Tuesday was 167.3p, while diesel was 179.7p.

This is an increase