Rachel Reeves declared in her first budget that the duty will stay at its existing rate, which fluctuates depending on the kind of gasoline.
At the moment, the headline price for regular gasoline and diesel is 52.95p per litre. This includes the previous government’s temporary 5p cut, which will also stay in effect.
The Office for Budget Responsibility (OBR) estimates that maintaining the freeze will cost the Treasury £100 billion between 2010–11 and 2025–26.
Fuel duty would have increased by 7p per litre if the cut had been removed and the rate had been unfrozen.
According to the RAC Foundation, the decision, which spares drivers from paying more at the gas pump, will be a “relief” for many. However, environmental activists have not been pleased with the move.
