Budget 2020: Raising Fuel Duties Will Explode The Economy And Cost Drivers Thousands Of Dollars – Warning | Politics | New

Chancellor Rishi Sunak will announce his first budget on Wednesday – just weeks after he replaced Sajid Javid as Downing Street as part of the large-scale cabinet reshuffle of Boris Johnson's conservative party. All eyes will be on the question of whether certain taxes will be raised, lowered or abolished, particularly following the UK's departure from the EU and uncertain trade relations after Brexit. But the newly appointed chancellor could spark fury in his budget by warning that the prices of petrol pumps will rise in the future, possibly as early as next year.

The duties on petrol and diesel amount to 57.95p per liter and VAT is also charged at 20%.

It has been frozen for almost a decade, costing the Treasury around £ 8 billion but saving the average driver £ 1,000.

Mr Sunak should focus on government preparations for the UK to be carbon neutral by 2050, which includes a ban on selling new petrol and diesel cars from 2035.

But political experts have warned to end a decade of freezing fuel tariffs and introduce a series of measures that would see it increase, hurt the economy and severely curb growth.

UK economic growth has remained stable in the last three months of 2019, against growth of 0.5% in the third quarter.

The auto industry had a particularly weak quarter after some factories shutdown in November when the UK feared a Brexit without a deal with the European Union.

Richard Wellings, head of transport at the Institute of Economic Affairs, told Express.co.uk: "Governments tend to consider gasoline taxes as a practical source of income when budget deficits are high.

"However, the fuel tax has harmful hidden effects that politicians rarely discuss – including the impact of rising travel costs on businesses and economic productivity.

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“The fuel duty is actually a trade tax in the UK. Increasing it will hurt the economy by reducing labor mobility, preventing economies of scale and curbing competition and specialization. "

Matthew Lesh, head of research at the Adam Smith Institute think tank, warned that an increase in fuel rights would be a "retrograde step" that would hit millions of motorists across the country.

He said: "An increase in fuel consumption would be particularly detrimental to those who live outside city centers and have no choice but to go to work and school.

"It would be a backward step for a government that intends to" level out "the economy by hitting motorists in the Midlands and the North.

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"If the government is serious about improving road taxation and race to the top, it should introduce a system of" congestion pricing "- which would mean taxing busy roads in big cities without affecting motorists in the less congested cities. "

Sam Packer, media campaign director at the TaxPayers ’Alliance, has urged the government not to raise fuel taxes, especially when the UK tax burden peaks at 50 years.

He said: “The freeze on fuel duties has brought some warmth to taxpayers suffering from the coldness of the mounting tax burden.

"As the tax burden continues to grow, to its highest level in 50 years, fuel taxes have been one of the few areas where taxpayers have not been forced to earn more money.

"The UK still has one of the highest fuel tariff rates in the world and the Chancellor certainly shouldn't increase it."

Furious Tories also warned Sunak that raising fuel duties would be an "absolute disaster".

They said any increase would damage the party's credibility after Prime Minister Boris Johnson insisted that he had "absolutely no intention" to impose the levy during the election.

Robert Halfon said: "This is a totemic tax and we cannot balance environmentalism on the backs of workers.

"We have to encourage people to use green cars, but not to hit families and workers hard.

“It would be an absolute disaster if we went back on what we said during the elections. We said we were going to be the party that would lower the cost of living for workers and that is what the Conservative party should be. "