Fuel duty rise to be staggered

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Fuel duty is set to rise in three stages, rather than in one jump, chancellor Alistair Darling announced in his budget speech.

The three per cent rise will now be staggered with a one per cent rise in April, a one per cent rise in October and a one per cent rise in January 2011.

The decision to stagger the increase will save industry £150 million, according to the FTA, it will however still represent a significant extra cost to businesses in the aftermath of the recession.

The logistics sector will be particularly hard hit when the three pence rise takes effect, says the FTA, because of the fuel duty escalator which has to be extended to 2014.

James Hookham, the FTA’s managing director of policy and communications, said: “For companies struggling to stay afloat, a staggered approach to increasing fuel duty will provide some breathing space. However, any increase in fuel duty, which is an unavoidable business cost, is bad news for the economy in the long-term and a staggered approach will delay its inevitably detrimental effects.”

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