Osborne rejects claims fuel duty to fund marriage plan

The fuel escalator became widely unpopular before being scrapped

Shadow Chancellor George Osborne has rejected reports that a Conservative government could increase fuel duty to fund tax cuts for married couples.

The Daily Telegraph said the Tories, if elected, would look at raising taxes on motorists and air passengers to pay for increased financial help for families.

Mr Osborne told the BBC he had no such plans and the reports were "wrong".

David Cameron has said he wants to recognise marriage in the tax system during the next Parliament.

'Family fund'

However, he has not given details of how this will be done or the cost involved, saying there are a number of options available.

According to the Telegraph, the Tories may look at raising "green" taxes in the next Parliament to pay for tax breaks for married couples.

We are not planning to jack up road taxes in order to fund anything George Osborne

The paper quoted an unnamed shadow cabinet minister as saying that Tory plans for a "family fund" - which would give small rebates to all married couples and larger incentives for those with small children - would initially be funded by reductions in spending.

But, in later years, the minister was quoted as saying these proposals could be funded by tax rises including duty on petrol.

"We could reintroduce the fuel-duty escalator, as long as we were upfront about it," the paper quoted the shadow minister as saying.

"We would say the cost of petrol will rise for the next five years to reduce carbon emissions and fund tax cuts for families."

The fuel duty escalator - in which petrol duty rises by several pence above inflation every year - was introduced by the Tories in 1993 and increased by Labour in 1997 before Gordon Brown scrapped it in 2000.

Mr Osborne said the Telegraph report was "unsourced" and "wrong".

"It bears no relation to the reality of our thinking in this area," he told the BBC. "We are not planning to jack up road taxes in order to fund anything. That does not match with the reality of our plans."

When he first became Tory leader, Mr Cameron backed the idea of green taxes to support the environment but the recession dampened enthusiasm for such an approach.

Family policy, and particularly extra fiscal support for marriage, has become a key issue ahead of the general election.

Earlier this month, Mr Cameron was forced onto the defensive after he appeared to suggest his longstanding commitment to tax breaks for married couples was now merely an aspiration due to the state of the public finances.

Labour and the Lib Dems have said the Tory plans amount to "social engineering".