The AA has called for a freeze in fuel duty after petrol and diesel prices at the pump hit a record high.
It also said the UK Government should consider introducing a price stabilisation system to save motorists from the worst effects of the hike.
We have been running a campaign for fairer fuel, including a fuel duty regulator, and the AA’s findings are further evidence of the financial pain drivers are suffering.
Its survey found that the average price of a litre of petrol has hit 128.6p £5.85 a gallon while diesel has increased to 133.2p a litre £6.05 a gallon.
Compared to this time last year, it now takes £8.20 more to fill the average tank of a petrol vehicle and £9.61 more for a diesel one.
One potential bright spot is that the wholesale price of petrol on world markets has fallen back from $850 in December to around $820 in recent days.
With the pound also strengthening against the dollar, the wholesale price has dropped from around 41p per litre in December to 39p now. That could start to filter through to forecourts soon.
AA president Edmund King said, “Average petrol prices wobbled earlier last week, dipping for the first time since the first week of September before continuing to go up.
“We understand that prices remain volatile, but hope that retailers will pass on savings when they can.”
He added, “Record pump prices are further evidence that the Chancellor must act to at least freeze duty and consider a price stabiliser.”
The motoring organisation’s regional fuel price survey found that the average price charged in Scotland for a litre of petrol during January was 127.7p, with diesel costing 133.2p.Third-cheapest petrolThat made the country the third-cheapest out of 12 UK regions for petrol, but the third most expensive for diesel. Supermarkets tended to charge less than garages.
The government now takes 63.2% of the price of petrol in tax.
Meanwhile, the government is facing calls to increase the 40p per mile rate that people who use their car for work, such as sales reps and district nurses, can claim back as a tax-free expense.
The AA reckons that the cost of running a saloon car is around 53p per mile. Fuel is only one element of that, along with insurance, road tax, maintenance and depreciation.
Many drivers are only reimbursed by their employer at the Treasury rate, so have to pay the extra themselves. This could easily amount to hundreds of pounds a year, depending on the size of the car and the mileage travelled, with some people potentially out of pocket by well over £1000.
Some employees will be able to claim higher mileage rates, but will be taxed on any sum above 40p.
Mr King said, “Government-approved mileage rates haven’t changed for nearly 10 years, during which time the price of petrol has soared.
“The system insulates many employers from soaring pump prices, forcing their employees to bear the burden of extra fuel costs.”
The Federation of Small Businesses backed the campaign, with a spokesman saying the Treasury had “lost touch with the reality of driving costs” and was forcing employers and employees to pick up the tab.
The Royal College of Nursing, which represents district nurses, said it had previously asked for the threshold to be raised.
A spokesman said, “The cost of motoring and duty is continually increasing and we feel it is unfair that low-paid staff such as our members should be taxed on money which is only a reimbursement of their out-of-pocket expenses.”If you want to support the Courier’s call for a fuel duty regulator, click here to add your name to our petition.