The RAC is calling on the Chancellor to further intervene in the cost of motoring after another sizeable rise in petrol and diesel prices in May.
It’s pointing to figures that show fuel rose 11p per litre in the month, meaning it is now at £8 per gallon, and how VAT revenue is rising thanks to the rising cost of fuel.
“May has proved to be another horrible month for drivers with the average price of petrol shooting up by 11p a litre. This is the second biggest monthly increase on record and comes despite the 5p-a-litre cut in duty,” said RAC fuel spokesman Simon Williams.
“Since Russia invaded Ukraine on 24 February the price petrol has gone up 24p a litre, For diesel the figure is 30p. This means the cost of filling a 55-litre petrol car has gone up by £13, and a diesel one by £16.50. Both of these figures would have been even higher had the Government not cut fuel duty.
“While it’s hard to imagine prices getting much worse, the wholesale price of petrol has now gone above diesel which spells yet more bad news at the pumps in the coming weeks.
“With drivers facing such a dire situation on the forecourts we badly need further intervention from the Chancellor as households and businesses surely can’t take much more financial pain in conjunction with the horrendous hikes in gas and electricity.
“Something needs to be done, whether that’s a further cut in duty from the current 53p charged on every litre bought at the pumps, or a reduction in VAT from 20%. Arguably, a duty cut would make a bigger difference to both businesses and individuals, but it also seems very unfair that the Treasury is benefitting to the tune of 30p a litre in VAT revenue from the record high prices – as it’s effectively a tax on a tax, applied on top of the wholesale fuel cost, duty, delivery and retailer margin. the challenges drivers are facing, a VAT cut would be instant and wouldn’t be swallowed up by fluctuations on the wholesale market.”
(Picture – Yay Images)