Since the Budget in March, the Treasury has already taken an estimated £820m more than its forecasts in North Sea oil tax. The £6bn of surplus revenue would easily cover the cost of U-turns on both fuel duty and vehicle excise duty, where ministers are introducing new bands which could cost an extra £200 for drivers of inefficient cars. Deferring the 2p increase in fuel duty by six months would cost £550m. Scrapping the revamped vehicle excise duty altogether would mean the loss of an estimated £465m next year and £735m next year – although ministers may only remove the retrospective element of this tax.
So scrapping the poll tax on wheels and the 2p hike on petrol taxes would cost about 9 weeks extra than forecast windfall taxes due to high oil prices. Scrap ’em now…
