Only last week the Prime Minister announced that a 2ppl increase to fuel duty, planned for September, won’t go ahead, but a report for HMRC indicates that instead, a 3ppl rise will be implemented in January.
The saga began back in 2022 when a temporary 5ppl fuel duty ‘discount’ was introduced to help offset spiralling petrol and diesel prices brought about by the war in Ukraine. That cut was subsequently extended on several occasions, but in November last year the Chancellor announced in her Budget that it would be wound down from September 2026.
That winding down was to begin with a 1ppl rise in September, followed by a 2ppl increase in December, and another tuppence rise in March 2027, at which point the 5ppl discount would be ended.
Bowing to pressure to ease the cost-of-living crisis, however, last week the Prime Minister announced that fuel duty would remain frozen for the remainder of 2026, postponing the discount’s demise.
Since then, HMRC has released documentation, spotted by Mail Online, revealing that the freeze is a three-month reprieve that will cause a sharper-than-expected rise in January 2027, when duty will rise by 3ppl, from 52.95p to 55.95p. Then, in March, the tax will go up by a further 2p, returning to the 57.95p litre level it sat at before the 2022 discount was implemented.
