Fleets could be hit by a 23% rise in the price of fuel duty in 2023, according to the Office for Budget Responsibility (OBR).
In its economic and fiscal outlook, published alongside the Autumn Statement, the OBR said that the reimposition of fuel duty would amount to an additional £5.7 billion tax boost for the Treasury.
Fuel duty was cut by 5p per litre in March to help motorists with rising pump prices, but that temporary measure is set to end in the spring of next year. The OBR said that the hike in fuel duty could increase prices by 12p per litre at the unleaded and diesel pumps.
It has been met with a negative reaction from those inside the fleet and motor industry.
David Wells, chief executive of Logistics UK, said: “The fact that the detail of this policy was hidden in the body of the OBR Report and not announced by the Chancellor in the House indicates that the Government was hoping to avoid scrutiny on the topic. We are seeking urgent clarification as to whether the duty rise will be implemented as planned, as a rise of this magnitude would have a detrimental effect on the UK’s economy.”
“A rise of these proportions would heap yet more misery on the millions of households that depend on their vehicles, most of whom will have just endured one of the costliest winters on record,” said RAC head of roads policy, Nicholas Lyes.
The Treasury has said that the figure of 23% ‘came from the OBR, not the Treasury’. MPs wrote to the Chancellor before the Autumn Statement urging him to cut fuel duty once again. If the forecast rise takes place, it would be the first time in more than 10 years that fuel duty rates rise in cash terms.