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Last Updated: Tuesday, 5 July, 2005, 15:37 GMT 16:37 UK
Fuel duty increase delayed again
Customer at petrol pump
Any rises at the pump have been deferred again
The increase in UK fuel duty due in September is being postponed again, the government has announced.

Fuel duty is due to rise at least in line with inflation every year but Gordon Brown used his Budget in March to defer the rise.

Now the Treasury says it will review whether to raise the tax in the autumn pre-Budget report.

The tax was frozen last year because of "volatility in the oil market". Oil prices have since risen further.

Fuel duties have now been frozen since October 2003.

On Tuesday, John Healey, Financial Secretary to the Treasury, said: "Following sustained pressure from G8 finance ministers, OPEC (which represents most of the largest oil producing countries) have committed to increasing quotas by up to 1 million barrels a day by September.

"But in the short-term uncertainty, and the risk of price volatility, remains high, with oil trading last week at above $59 per barrel."

The freeze includes rebated oils, biofuels and road fuel gases.

Hauliers' welcome

The government says fuel duty has not risen in real terms since 1999 and at 47.1p per litre, taxes on the main types of petrol and diesel are lower now in cash terms.

The freeze was welcomed by Steve Williams from the Road Haulage Association, which staged protests about fuel prices during the election campaign.

Coming just before the G8 summit, this sends the wrong signal about tackling climate change
Friends of the Earth

Mr Williams said: "Obviously it's good news. We are having enough trouble as it is without a further increase in duty."

But he urged the government to go further and introduce a system which reduced duty if oil prices went beyond $60 a barrel, for example.

The government's general policy of imposing an inflation rise in fuel duty is designed to meet environmental commitments.

Friends of the Earth said it was extremely disappointed by Tuesday's decision, saying the cost of motoring had fallen by 6% in real terms since Labour came to power in 1997.

A spokesman said traffic levels had risen in the same period and road transport accounted for 22% of the UK's carbon dioxide emissions.

"Coming just before the G8 summit, this sends the wrong signal about tackling climate change," he added.

See how petrol prices have risen

Refinery protest over fuel costs
29 Apr 05 |  Scotland
Petrol duties frozen, Brown says
02 Dec 04 |  Politics
Fuel duty rise postponed by Brown
20 Jul 04 |  Politics

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