A leading motoring expert has criticised the Government for its decision to “ignore fuel tax” in Labour’s first Budget since the July election.
Speaking in Parliament yesterday, Chancellor Rachel Reeves unveiled the Government’s fiscal plans for the coming years as it attempted to account for a £22billion spending black hole.
Experts criticised Rachel Reeves for not addressing fuel tax in the Budget
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Thom Groot, CEO of The Electric Car Scheme, reacted to the announcements in the Budget, saying that the Government should have taken steps to support electric vehicles.
He continued, saying: “Ignoring fuel tax in the Budget is a huge mistake.
“We are 14 years overdue for a fuel tax increase, and the subsidising of fossil fuels needs to end if we are to reach our net zero and ZEV targets.
“The £100billion this freeze has cost the Treasury so far, invested properly, could have been transformative to the NHS, infrastructure or just the national debt and there is no excuse for extending it.”
He noted that the money being spent on these measures could have been spent on “levelling the playing field” for EV drivers charging in public.
There have long been calls from experts to slash the rate of VAT on the price of public charging down to five per cent, to match the rate attributed to home charging.
Groot claimed this would have cost just £14million and helped hundreds of thousands of electric vehicle owners save money if they didn’t have the facilities to charge at home.
The Government did announce a further £200million in 2025-26 to accelerate EV chargepoint rollout, as well as funding for local authorities to install chargers.
A further £120million will be available to support the purchase of new electric vansvia the plug-in vehicle grant and to support the manufacture of wheelchair accessible EVs.
Groot added: “The £20billion black hole that has dominated headlines cannot be filled at the cost of the net zero transition, it would be madness to do so.
“Not to mention the cost to the NHS of poor air quality and extra funding freed up by ending this subsidy. Introducing a levee on aviation fuel would also increase the tax take and help tackle climate change.”
Speaking in the Commons, Rachel Reeves announced that fuel duty would be frozen for another 12 months despite fears that the price would be hiked by as much as 7p per litre.
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Electric vehicle drivers were backed with extra funding for public chargers
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She said: “I have concluded that in these difficult circumstances, while the cost of living remains high and with the backdrop of global uncertainty, increasing fuel duty next year would be the wrong choice for working people.
“It would mean fuel duty rising by 7p per litre. So I have decided today to freeze fuel duty next year and I will maintain the existing 5p cut for another year too. There will be no higher taxes at the petrol pumps next year.”
