Did Labour lie? Fuel duty expected to rise in October, resulting in ‘perma-high’ petrol prices

Despite Labour’s promise not to raise taxes for “working people”, the government has told Auto Express that “difficult decisions” could be made regarding fuel duty later this year, pushing up the price of petrol and diesel for millions of motorists.

Prior to the party’s victory in the general election, Labour publicly protested against allegations that it would raise taxes on working families. However, now-Prime Minister Keir Starmer consistently dodged questions on whether he would reverse the five pence cut to fuel duty.

Introduced back in 2021 by the previous Conservative administration, the fuel duty cut was devised as a temporary means of addressing the fuel crisis at the time. Since then, the government administrations have kept extending the reduction, although this didn’t stop fuel prices from rising to highs of 191.5 pence per litre for petrol and 199 pence for diesel in the Summer of 2022.

We could soon be in store for another such price hike as Labour has confirmed that tax rises will be a part of the Autumn budget and the AA reckons the cut to fuel duty could be one of the several items on Rachel Reeves’ hit list.

When asked about a potential rise in fuel duty, a spokesperson for HM Treasury told Auto Express that: “Following the spending audit, the Chancellor has been clear that difficult decisions lie ahead on spending, welfare and tax to fix the foundations of our economy and address the £22bn hole in the public finances left by the last government. Decisions on how to do that will be taken at the Budget in the round.”

This is sobering news, with the AA regarding the five-pence cut as “the only bit of good news in a bleak three years of ‘perma-high’ pump prices”.

“Overall, the AA is concerned that current high prices could be made significantly worse with any hike in fuel duty in October.” An AA spokesperson warned: “If the Chancellor reverses this it will hit drivers, businesses, and the economy hard.”

Despite the new Transport Secretary telling Auto Express in our exclusive pre-election interview that Labour is “the only party truly on the side of drivers”, in its first few weeks running the country, it has already cancelled several planned road infrastructure projects, pinning the majority of its focus on public transport, rather than the needs of motorists.

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