Government raises red diesel duty

Details of increases released with Pre-Budget Report

The duty on red diesel will rise tomorrow, after the Government announced in today’s Pre-Budget Report (PBR) that it would finally enact the increase in fuel duty it set down in March’s budget.

The rise of 1.25p per litre will apply to most fuels, except LPG for road use, which will go up 3.21p per kg.

The Government said in the PBR that fuel price volatility throughout the year led it to defer the duty hike.

Meanwhile, in a section of the report entitled ‘Building a Fairer Society’, the Government has said it may legislate to “ensure a suitable period of transition and minimise the longer-term compliance burden” after the European Commission (EC) declined to renew the derogation on rebated fuel for private air navigation.

This may hint at the Government’s course of action if the EC were to reject the UK’s application for an extension to the red diesel derogation.

Recommended videos for you

MBM reported in earlier this month that a decision on red diesel was expected before Christmas. The EC has since told the magazine that it would release details of its decision as soon as it was made.

To get the latest on the derogation, and to find out how your MEP has responded to a call from MBM to lobby the EC, see the ‘Red Diesel Blog’.