HOW THE BUDGET MIGHT AFFECT MOTORISTS

The upcoming Autumn Budget is expected to hit motorists hard. Claire Evans takes a closer look at what might be in store

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THE NEW GOVERNMENT'S first Budget will be outlined on 30 October, and rumours are rife that it will penalise drivers heavily.

One tactic that Chancellor Rachel Reeves might use to raise money is to remove the 5p per litre discount on fuel duty that was introduced by the previous Government in 2022. This would put the fuel tax rate back up to 58p per litre, taking the average cost of a litre of petrol up to 145.61p and diesel up to 150.35p.

For a driver covering the UK's average of 7400 miles per year, the increase in fuel duty would equate to an additional average cost of £43 per year to run a petrol car and £39 for a diesel.

Combined with the fuel duty freeze, which has been in place since 2011, the two policies have cost the Treasury £100 billion in the past 13 years, according to analysis by the Social Market Foundation (SMF). It says scrapping them would bring in £27bn over five years.

The RAC motoring organisation is in favour of ditching the 5p discount on the grounds that fuel suppliers haven't been passing it on at the pumps. "We'd normally be against any increase in duty," said RAC head of policy Simon Williams, "but we've long been saying that drivers haven't been benefitting from the current discount due to much higher-thanaverage retailer margins."

On the other hand, the AA is calling for a continuation in the freeze. "Scrapping the 5p freeze in fuel duty would hurt everyone, not just drivers," said AA president Edmund King. "Everything from the price of food in supermarkets to the delivery of social care within our communities are impacted by pump prices, and an unnecessary hike in fuel duty could make things worse."