What is fuel duty and has the rate been frozen?
FUEL duty is a hot topic for drivers as they look to keep the costs of buying petrol and diesel down.
It comes as the Treasury has been under huge pressure in recent weeks to keep the popular 12-year fuel duty freeze as well as the 5p cut.
What is fuel duty?
Fuel duty is a tax on fuel including petrol, diesel, biodiesel and bioethanol.
VAT (Value Added Tax) is also charged on most fuel.
The Sun’s Keep it Down campaign has forced ministers to freeze duties for 12 years in a row.
How much is fuel duty per litre?
The fuel duty tax has been frozen at 57.95p for every litre since March 2011.
However, on March 23, 2022, Sunak announced that it would be cut by 5p per litre from 6pm that evening.
But the 12-month measure only lasts until the end of March.
The cut — introduced by then-Chancellor Mr Sunak in the wake of The Sun’s Keep It Down campaign — is worth around £5billion to hard-working families and businesses.
When VAT is factored in, this should equate to 6p off the price of a litre of petrol or diesel.
That means motorists will pay just 52.95p per litre for fuel duty – which is expected to save drivers around £3.30 every time they fill up.
What has Jeremy Hunt said on fuel duty?
Treasury sources say Jeremy Hunt is keen to extend the tax cut in his Spring Budget if public finances are in good shape.
No final decisions on taxes have been made yet, with Treasury officials keeping a close eye on inflation before solidifying Spring Budget policies.
Rishi Sunak and Chancellor Jeremy Hunt have previously warned that all taxpayers will have to cough up more to help balance the nation’s books.
How to cut fuel costs with rewards programs
There are ways to save an extra 5p per litre if you sign up for major supermarket loyalty schemes.
Esso has partnered with Nectar for its loyalty scheme and you can get 5p off a litre when you swap 300 Nectar points.
Drivers with a BPme rewards card will get one point for every £1 they spend in-store or on a litre of regular fuel at a BP garage.
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Motorists will get £1 off their fuel or shopping for every 200 points.
Texaco, Shell, Sainsbury’s and Tesco loyalty card holders can also get money off their bills.