Fuel tax reaches record high | Motoring Issues - Car News Nov 2012

MOTORING ISSUES
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11:00 Thursday 08 Nov 2012

The amount of tax paid by motorists on each litre of fuel has reached a record high, new figures have revealed.

Data from the House of Commons Library shows that, of the 138.3p typically paid for a litre of unleaded, 81p goes to the Treasury. Drivers of diesel cars are paying a similar amount of tax, with 81.8p from every litre of diesel finding its way into the Chancellor's pocket.

A 3p per litre increase in fuel duty is planned for January 2013; however, motoring groups are urging the Chancellor to scrap the rise, claiming that it will have a detrimental effect on the UK economy.

The total fuel taxation in Britain includes fuel duty and VAT (which is levied both on the fuel itself and the duty paid on it). Roughly 59% of the price of a litre of petrol, and 57% of the price of a litre of diesel is tax.

Motorists might be surprised to hear that, in percentage terms, these figures are nothing out of the ordinary. Back in 1990, motorists were paying roughly the same percentage of tax per litre of fuel but by 1999 the figure was much higher -- around 85%.

Not that this is any comfort to Britain's beleaguered motorists -- UK fuel duty is the second highest in the European Union. British diesel is also the most expensive in the EU, while petrol prices are the fourth highest, behind Greece, the Netherlands and Italy.

Conversely, the cheapest fuel in the EU is in Bulgaria, where motorists pay just £1.01 for a litre of unleaded and £1.02 for a litre of diesel.

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