Thursday, 6 January 2011

Repeated Highway Robbery

I thought it was time to update my post on how much petrol actually costs before the government gets involved, see original post here. The fuel duty is now at 58.95 pence per litre, see here and VAT is now at 20%. This means that the £1.239 per litre that I paid the night before last consists of 20.65p in VAT, 58.95p in fuel duty and 44.3p as the actual retail cost of the petrol. This means that I am now paying a total of 79.6p in tax on a litre of fuel. This is up from the 72.71p per litre I was paying last March which represents an increase of 9.5%. The cost of a litre of fuel has gone from £1.109 to £1.239 which is an increase of 11.7% which is larger than the tax increase thus the effective taxation rate has come down from 190.4% to 179.7%. The final sentence of this blog is depressingly similar to the previous one; it is sobering to note that the duty will increase by 1% above inflation every 1 April from 2011 to 2014.

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