Friday, 5 March 2010
As I was filling my car with petrol last night I was pondering the cost of the liquid that was pouring into the tank. A little research here reveals that the government levies a duty of 56.19p per litre of unleaded petrol. Given that VAT is calculated on the price of the petrol and the duty, this means that the petrol I was purchasing for 110.9p was actually being sold by the petrol company at 38.19p per litre. This means that I was being charged a staggering 72.71p per litre which is equivalent to a tax rate of 190.4%. It is sobering to note that the duty will increase by 1% above inflation every 1 April from 2010 to 2013.