Jeremy Hunt delivers speech on plans for the UK economy
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Chancellor Jeremy Hunt has been warned about the dire consequences of pressing ahead with plans for a hike in fuel duty in next week’s Budget. The warning from former Home secretary Priti Patel came after she was one of 45 MPs to attend a meeting in the Commons to oppose a rise in tax for hard-pressed motorists.
The strength of feeling on the issue was expressed at the APPG chaired by Conservative Thanet South MP Craig Mackinlay which was attended by Ms Patel as well as newer MPs including Stoke North Tory Jonathan Gullis.
There are concerns the Chancellor will bring in the first fuel duty increase since George Osborne cancelled the escalator in 2010 brought in by Gordon Brown and Alistair Darling in the last Labour government.
Some reports have suggested that Mr Hunt will increase duty by as much as 14p per litre when VAT is taken into account.
Ms Patel warned such a move would be unacceptable and cause misery.
Ms Patel tol Express.co.uk: “Households and businesses concerned about the OBR forecast on fuel duty and potential increase of 12p per litre (more than 14p when VAT taken into account).
“Fuel duty increase could impact and drag on the economy by 1 percent, add 2.3 percent to inflation and put 31,000 jobs at risk. Hauliers face additional fuel costs of tens of thousands of pounds and families face hundreds of pounds more in costs.”
The current Fuel Duty rate is 52.95p per litre but this could go up to as much as 66.95p.
Ms Patel went on: “Keeping taxes on fuel down is vital to support the economy.
“Freezes on Fuel Duty since 2011 have saved households an estimated £24bn.
“Keeping more money in the pockets of families – keeping fuel taxes down in this Budget vital to help those facing costs of living pressures.”
The former Cabinet minister has become a focus of discontent in the current Conservative leadership under Rishi Sunak as one of the main MPs supporting the grassroots Conservative Democratic Organisation (CDO).
She echoed concerns of colleagues that Mr Hunt and Mr Sunak’s tax rising agenda will harm economic growth and add to the cost of living misery while making Britain uncompetitive internationally.
Ms Patel said: “Competitors in other countries benefit from lower taxes on fuel.
“Two of the Government’s five priorities can be supported by freezing and cutting fuel duty – Grow the economy, halve inflation by end of the year.
“Backing the nation’s motorists will show Conservatives are firmly on the side of Britain’s hard-working law-abiding majority.”
She also pointed to the added costs to motorists of £12.50 a day to drive in London for many vehicles thanks to Labour Mayor Sadiq Khan’s expansion of ULEZ.
She warned: “Labour’s track record on fuel duty and on motorists is one that punishes them and milks them for every penny possible, 55 percent increase in fuel duty under Labour, from 36.86p to 58.95p.
“Those in and around London face ULEZ tax £12.50 a day.”
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The meeting was hosted by Fair Fuel UK led by Howard Cox.
Mr Cox said: “We gave MPs three options – they all supported a duty freeze or cut, strangely enough none of them backed a hike.”
The row over fuel duty increases is one of many headaches faced by the Chancellor next week.
Already he is under pressure to cancel the planned increase in Corporation Tax which has been branded “disastrous” for economic growth by Tory backbenchers.
There is also pressure over suggestions he could raise the state age of retirement and the age when prescriptions become free for the elderly.
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