3p fuel duty cut would benefit economy across board, finds report
The report commissioned by FairFuelUK, confirms that the lower petrol and diesel prices of 2015 have raised UK GDP by 0.6%, created an extra £11.6bn of economic activity, 121,000 jobs and boosted government tax revenues.
The research also shows that raising duty on diesel or increasing VED on diesel vehicles would cost businesses and families £9.3bn across the current Parliament. The research shows that the low oil and fuel forecourt prices seen this year have increased business investment, lowered production costs and improved household spending across the UK economy. Critically, the data also proves that the suspension of the government fuel duty escalator has increased tax revenues to the Exchequer by a net gain of £1.3bn. Had the fuel escalator been in place the extra burden to the economy would have been £4.9bn.
The CEBR report also warns that any plans to increase tax levies on diesel usage as a reaction to the VW emissions scandal would cost the UK economy over £9bn in extra taxation.
Howard Cox, founder of FairFuelUK, said: ‘George Osborne should look at this data very carefully indeed. We’ve provided clear evidence-based proof that lower transport costs of 2015 have significantly benefitted everybody, including the Treasury and there’s now no argument left not to reduce fuel duty. Any plans he may have to penalise drivers for using diesel cars, vans and trucks will backfire badly and hit businesses and families with a shocking £9.3m bill.”
However, a new report from the Environmental Audit Committee says that the Autumn Statement should incentivise vehicles which emit less nitrogen dioxide, as well as less carbon dioxide, and should look at a diesel scrappage scheme.