The PRA has met with the Exchequer secretary Priti Patel to press its case for a 2ppl cut in fuel duty funded by a tax windfall from the increased fuel volumes.
At the meeting the PRA provided an analysis of Government data showing that the rapid fall in crude oil prices from mid 2014, together with an improving economy, had increased the overall volume of road fuels supplied by 1.6% to the end of September. If this trend continues, an extra £400m from excise duty would be produced compared to the same 12 months in 2013.
PRA chairman Brian Madderson said: “With more vehicles on the road after a record high of new car sales in 2014, lower crude oil costs continued to bring down prices even further, and with continuing economic growth, fuel volumes in 2015 could increase by more than 2.0% providing more windfall tax revenue.
“The Prime Minister and Chancellor have recently pressed oil companies and retailers to reduce fuel prices on the back of plunging crude costs as the “holy grail” of £1 per litre comes ever closer. However, at this level, it exposes the fact that 75% of the pump price is Government tax.
“Far from being damaging, such a cut would be tax neutral and further stimulate the economy and job prospects.”