£100 to fill your tank is ‘inevitable’, warns RAC Business

The £100 tank of petrol is now ‘unavoidable’, the RAC has warned motorists, as Rishi Sunak prepares to cut fuel tax in the spring declaration.

Average fuel prices hit new records with petrol topping 167p a liter and diesel set to top 180p for the first time, the RAC said.

“The cost of filling an average 55-litre family car with petrol is now over £92 and nearly £99 for diesel, making the £100 tank unavoidable,” he said. he adds.

His warning comes as the Treasury considers a 5p per liter cut in fuel duty as prices at the pump soar.

Fuel duty has been frozen for more than a decade at 57.95pa liter but the cut would cost the Chancellor around £2.5billion.

Mr Sunak faces mounting pressure to help protect households from the fastest rising cost of living in 30 years.

The RAC said the effect of record fuel prices meant that cash-strapped drivers were forced to cut other expenses or deliberately cut back on the number of leisure journeys.

RAC’s Nicholas Lyes said: “As the cost of living crisis really begins to bite, there is now huge pressure on the Chancellor to act today to help drivers – who we know is majority depends on their vehicles day in and day out.

“Despite rumors of a reduction in fuel duty now widely circulated, our analysis shows that in many respects a reduction in VAT would benefit drivers more – and be fairer to those who drive diesel vehicles and pay a significant premium for fuel at the moment, with the cost of filling up a family car almost £100 for the first time.”

RAC calculations show that a 5p cut in fuel tax would cut the cost of filling a 55-litre car by around £3.

However, a 5% reduction in VAT would result in a reduction of almost £4 on the cost of filling a petrol car and over £4 on a diesel vehicle.

Simon Williams, the car body’s fuel spokesman, said: ‘A reduction in VAT would be a much more flexible and powerful way of alleviating the pain of drivers.

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This notice was published: 2022-03-23 11:28:42

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