UK budget: no fuel duty rise, EV grant extended

He might have only been in the job for four weeks, but chancellor Rishi Sunak has just delivered the government’s annual budget statement in the House of Commons.

Indeed, it’s the day where economists and red briefcase fans delight, the rest of us not so much (for a detailed unpacking of rate relief for small businesses there are other websites available).

Sunak might have been splashing the cash around to cushion the impact of coronavirus, but how did motorists fare in the speech? Well, it’s not as bad as we thought it might be.

Treasury leaks suggested a fuel duty rise of 2p a litre, but Sunak announced in his speech that the nine-year freeze on the tax would remain in place for another year. Back in 2010 annual increases of 1p a litre above inflation were halted. Had they not been, petrol and diesel would cost 24p a litre more right now. Phew.

Now the government is on an electric bender (current plans will see petrol and diesel engines taken off sale in 2040), ministers are looking at ways to encourage us all into zero emission vehicles, so it looks like we’ll see fuel duty increases this time next year.

Looking to get yourself one of those fancy new electric cars? The £3,500 Plug-in Car Grant, which was set to run out at the end of this month, has been extended for three years while the government has a think about other things it can do to persuade more people to make the switch.

As an extra bonus, new EV buyers won’t have to pay the ‘expensive car supplement’ of £310 a year on their first five years of VED if the car costs more than £40,000.

Elsewhere there was £27bn announced for the glamorous work of building new roads and upgrading motorway junctions, as well as £2.5bn that will literally be poured into potholes over the next five years.

What do you think about incentives to get us into electric cars – convinced yet?