I am writing to update you about fuel prices, which you have previously contacted me about.
The Government recognises that fuel costs remain a significant part of business and household costs. At the Autumn Statement in November 2016, the Chancellor announced that fuel duty will remain frozen for a seventh year. In total, this saves the average car driver £130 a year and the average van driver £350. This is a tax cut worth £850 million next year, and means the current fuel duty freeze is the longest for 40 years.
The Competition and Markets Authority, the body charged with monitoring competition within UK markets, investigated the fuel retail market in 2013 in order to determine whether there was anti-competitive behaviour by market participants. It found no evidence that retailers are colluding to fix pump prices. However as a member of the APPG on fuel we are keeping a close eye on this.
There is no legislative framework for purchase receipts, which are simply acknowledgments of payments. There is VAT legislation on when an invoice must be provided, but this only states that VAT-registered businesses are obliged to provide invoices to other VAT-registered businesses. Expanding this information to cover all forms of taxes and duties, for all private motorists as well as businesses, would dramatically increase administrative burdens for retailers, and therefore their costs. I understand that the Government therefore has no plans to implement this proposal.
Reduced duty rates are offered on alternative fuels as an incentive for drivers to move to cleaner fuels. Liquefied petroleum gas, compressed natural gas, liquefied natural gas, biomethane and aqua-methanol all benefit from reduced duty rates.
Thank you again for taking the time to contact me.