The Chancellor’s decision to increase fuel duty in August was described as a “Budget Blow-Out by the AA, whose research shows such increases will force two thirds of drivers out of their cars for some journeys. For almost one fifth of drivers these increases will hit their food budget as 18% of all drivers will have to cut back on grocery shopping.

Edmund King, AA president, said: “At a time of record prices at the pumps the August increase in duty is a budget blow-out which will force drivers off the road and could bring a summer of discontent for many.
“We have heard much about tax allowances but the increase in fuel duty makes no allowance for car-dependent, rural and disabled drivers. Only last week the Prime Minister told American students that UK fuel prices would make them “faint”, yet the Government seems intent on inflicting more pain for no gain on drivers. Ironically, such a hike in duty doesn’t necessarily help government finances as people will cut spending at the pumps and in shops, and it could fuel inflation.
Fuel price facts:

Fuel duty on petrol and diesel was scheduled to increase by 3.02p on August 1, 2012. With VAT added, pump prices will rise 3.62p a litre.
·         A typical 50-litre petrol refill will cost £1.81 more.
·         Filling an 80-litre commercial van tank will cost £2.90 more.
·         The monthly petrol bill for a two-car family will go up by £7.69
·         With the UK retailing 50.0 million litres of petrol and 45.9 million litres of diesel a day (DECC volumes for Q3 2011 divided by 92 days), the Treasury will from August gain an extra £3.47 million a day.
At today’s price, 139.67p a litre, the cost of a litre of petrol breaks down into: 57.95p fuel duty, 23.28 VAT (total tax – 81.19p or 58.2%), 52p wholesale, 1.5p biofuel content, 4.94p retailer’s margin, transport costs, admin.

Since March 2010, the price of petrol has risen 23.24p a litre or 19.9%. For a family with two petrol cars, the monthly fuel bill has risen £49.35.
Since March 2011, the price of petrol has risen 6.5p a litre or 4.8%. For a family with two petrol cars, the monthly fuel bill has risen £13.87.
Latest record prices: petrol 139.67 p/ltr, diesel 146.39

AA/Populus Poll  16,647

Q. If petrol prices reached 145p a litre and 150p for diesel, which of these would apply to you (by socio-economic group):

Cut back on grocery shopping: All 18%, AB 15%, C1 20%, C2 19%, DE 20%.
Abandon or delay purchase of furniture, home improvements or luxury items: All 23%, AB 20%, C1 27%, C2 23%, DE 20%.

Cut back on car use: All 63%, AB 61%, C1 63%, C2 65%, DE 69%.
Change job to reduce mileage: All 4%, AB 3%, C1 5%, C2 5%, DE 4%.

Abandon job because of unaffordable travel costs: All 3%, AB 2%, C1 3%, C2 4%, DE 3%.
Groups: AB (higher or middle level managerial, administrative or professional position), C1 (supervisor or clerical position; junior managerial, administrative or professional position; self-employed; student living away from home), C2 (skilled manual or service worker), DE (semi skilled or unskilled manual or service worker; dependent on state benefits; unemployed for six months or longer; or state pensioner with no earnings).