By David Hanson MP / Latest News / 0 Comments

Hanson Calls for VAT Fuel Rise Reversal

Delyn MP and Shadow Treasury Spokesman David Hanson is calling on the Chancellor George Osborne to reverse the government’s VAT rise on fuel.

The hike in VAT to 20 per cent in January has added nearly 3p to the price of a litre of petrol and will raise £700m for the Treasury, according to figures from the independent House of Commons Library.

The Labour Party says the VAT rise should be reversed immediately on petrol using the £800m extra the government is now getting from the bank levy, compared to what it was expecting in the last Budget.

David Hanson said:

“I’ve consistently opposed the Conservative-led government’s VAT rise which has hit families in Delyn and helped to push up petrol prices to their current record levels.

“It’s time the Chancellor George Osborne took immediate action on fuel prices to ease the pressure on families who are already facing a tough year and their incomes squeezed. He should immediately reverse the VAT rise on fuel, which has added nearly 3p to the price of a litre of petrol, using the extra £800m the Treasury will be getting from the bank levy.

“And in the Budget later this month George Osborne should look again at the annual fuel duty rise due in April. The last Labour government often postponed planned duty increases when world oil prices were on the up – as they are now. The Tories promised a ‘fuel duty stabiliser’ to win votes before the election, but if they don’t deliver one it will just be another broken promise from this government.

“The AA’s latest fuel price report shows that across Wales the average cost of a litre of unleaded petrol in February was 129.1p – up 6.8p compared to December before the VAT rise. And the current instability in the Middle East and North Africa is driving up oil prices around the world which means the price of petrol at the pump is continuing to rise.

“Now is the wrong time to be making things even worse for hard-pressed families in Flintshire by hiking up VAT, as this government has done. George Osborne should admit he got it wrong and reverse the VAT rise on petrol now.”

Shadow chancellor Ed Balls MP added:

“I hope people across Flintshire will back our campaign and send a message to the Chancellor George Osborne that he needs to act immediately to reverse the VAT rise on fuel. It’s the wrong tax at the wrong time and is hitting families and businesses hard.

“George Osborne also needs to come up with a plan to get our stalled economy moving again and get more people into work making their contribution and paying taxes. That’s the best way to get the deficit down and ease the pressure on families facing the squeeze.”


Notes for Editors

Labour’s campaign can be found at

Research by the House of Commons Library shows that the rise in VAT is adding 2.71p to the cost of a litre of unleaded petrol, assuming a pump price of 130p. Based on these figures the VAT rise has added £1.35 to the cost of filling up a 50 litre tank.

Fuel prices by region

The table below shows the average price in pence of a litre of unleaded petrol (95 octane) in each region and nation of the UK, according to the AA fuel price reports for February 2011 and December 2010.


  Average unleaded price (pence)

Region/nation Feb 2011 Dec 2010 Change
Northern Ireland 129.9 122.6 7.3
Scotland 128.6 121.6 7.0
Wales 129.1 122.3 6.8
Northern Ireland 128.2 121.4 6.8
North West 128.4 121.7 6.7
Yorks & Humberside 127.8 121.2 6.6
West Midlands 128.6 122.1 6.5
East Midlands 128.3 121.9 6.4
East Anglia 129 122.5 6.5
South East 129.5 122.7 6.8
South West 129 122.5 6.5
London 129.3 122.7 6.6
UK Average 128.8 122.1 6.7