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Tax and duty

Fuel duty and VAT, explained

Two separate taxes are built into every litre of fuel you buy. Here's what they are and how they differ.

Fuel duty (per litre, petrol and diesel)

52.95 pence per litre

A temporary 5p/litre cut, first introduced March 2022, extended at Autumn Budget 2025 to run through 31 December 2026.

Source: GOV.UK — Amended Fuel Duty rates: 2026 to 2027

VAT on fuel (applied to price + duty)

20% (standard rate)

Petrol and diesel are not on GOV.UK's reduced or zero-rate lists, so the standard rate applies.

Source: GOV.UK — VAT rates

These figures are verified.

We publish current fuel duty and VAT rates only once checked against an official source such as GOV.UK or HM Treasury — both figures above are cited directly. If a rate changes, we do not invent an updated number; the card reverts to a clear placeholder until the new rate is verified.

What is fuel duty?

Fuel duty is a tax charged by the UK Government on every litre of petrol and diesel sold. It is a fixed amount per litre — set in pence, not as a percentage — so you pay the same duty on a litre of fuel whether the underlying price is high or low. Because it's fixed, fuel duty makes up a larger share of the total price when fuel is cheap, and a smaller share when fuel is expensive.

What is VAT?

Value Added Tax (VAT) is charged as a percentage of the total fuel price, including fuel duty. This means VAT is applied on top of duty, not the other way round. Because it's percentage-based, the amount of VAT you pay rises and falls in line with the underlying price of fuel.

Fixed tax vs percentage-based tax

Fuel duty (fixed per litre)

A set number of pence charged on every litre, regardless of price. If the fuel price falls, fuel duty stays the same — so it becomes a bigger proportion of what you pay.

VAT (percentage-based)

A percentage of the fuel price plus duty. If the fuel price rises, the amount of VAT you pay rises too, because it's calculated as a share of a larger number.

Calculating the tax component

Using the verified rates above: fuel duty is a flat 52.95 pence on every litre. VAT is then charged at 20% on the fuel price including that duty. For example, on a litre priced at 168.1p (petrol, 14 September 2026): the pre-VAT price is 168.1p ÷ 1.2 ≈ 140.1p, so VAT is roughly 28.0p. Added to the 52.95p duty, tax makes up around 81p of that litre — close to half the total pump price. See our full pump price breakdown for the complete picture, including wholesale cost and retailer margin.

Fuel Duty is a policy choice, not a fixed law

The current era: 2022 to today

Fuel Duty rates since the Spring Statement 2022 cut, including confirmed future changes.

  1. 23 March 2011Previous rate57.95p/litre

    Pre-2022 base rate

    Budget 2011's 'fuel duty stabiliser' cut the rate by 1p, from 58.95p to 57.95p. It then stood unchanged for almost exactly 11 years, until the Spring Statement 2022 cut below. See the full 1989–2022 history further down this page.

    Source: GOV.UK — Amended Fuel Duty rates: 2026 to 2027
  2. 23 March 2022Previous rate52.95p/litre

    Spring Statement 2022: temporary 5p/litre cut

    In response to fuel prices and the invasion of Ukraine, the Chancellor cut Fuel Duty by 5p/litre, from 57.95p to 52.95p, initially for 12 months.

    Source: GOV.UK — Spring Statement 2022 Fuel Duty factsheet
  3. 15 March 2023Previous rate52.95p/litre

    Spring Budget 2023: cut extended

    The 5p cut was extended for a further 12 months, cancelling a previously planned RPI increase.

    Source: HM Treasury Spring Budget 2023
  4. 6 March 2024Previous rate52.95p/litre

    Spring Budget 2024: cut extended again

    The 5p cut was extended again, with the rate remaining at 52.95p.

    Source: HM Treasury Spring Budget 2024
  5. 30 October 2024Previous rate52.95p/litre

    Autumn Budget 2024: cut extended a further year

    The 5p cut was extended for a further 12 months, pushing its scheduled expiry to 22 March 2026.

    Source: GOV.UK / HM Treasury Autumn Budget 2024
  6. 26 November 2025Previous rate52.95p/litre

    Autumn Budget 2025: further extension, later revised

    The 5p cut was extended by a further 5 months to 31 August 2026, with a phased reversal originally scheduled for 1 September and 1 December 2026. This specific schedule was subsequently superseded by a statutory instrument in May 2026 — see below.

    Source: GOV.UK — Fuel duty rates: 2026 to 2027 (original schedule, since amended)
  7. 15 June 2026Current rate52.95p/litre

    Current rate, extended to 31 December 2026

    A statutory instrument (SI 2026/555) cancelled the previously scheduled September and December 2026 increases and extended the 52.95p rate to run through 31 December 2026.

    Source: The Excise Duties (Surcharges or Rebates) (Hydrocarbon Oils etc.) (Amendment) Order 2026 (SI 2026/555)
  8. 1 January 2027Announced future rate55.95p/litre

    Confirmed rate change: 1 January 2027

    SI 2026/555 confirms the rate rises to 55.95 pence per litre from this date — a partial unwinding of the 2022 cut.

    Source: GOV.UK — Amended Fuel Duty rates: 2026 to 2027
  9. 1 March 2027Announced future rate57.95p/litre

    Confirmed rate change: 1 March 2027

    SI 2026/555 confirms the rate rises to 57.95 pence per litre from this date — a full return to the rate that applied before the March 2022 cut.

    Source: GOV.UK — Amended Fuel Duty rates: 2026 to 2027
  10. 1 April 2027Proposed — not yet confirmed

    Possible return to RPI-linked uprating

    The Government has stated an intention to resume RPI-linked (inflation-linked) annual increases from this point. This is a stated policy intention only — it is not yet set in legislation, and no confirmed rate exists for this or any later date.

    Source: HM Treasury Budget statements (policy intention, not yet legislated)

The full picture

Fuel Duty since 1989

Every verified rate change from the modern duty structure's introduction to the start of the current era.

Fuel Duty rate changes, 1989–2011

HISTORICAL

Every rate change from the introduction of the modern duty structure to the start of the current era (2011, when the rate settled at 57.95p until the 2022 cut — see the timeline above). Sourced from two independently verified primary sources: the House of Commons Library's citation of HMRC's own Hydrocarbon Oils Statistical Bulletin (1989–2007), and GOV.UK's weekly road fuel prices series (2008–2011) — the same dataset used throughout this site's historical pump-price data.

DateRateWhat happened
14 March 198917.72pUnleaded petrol duty rate set in the 1989 Budget.Source: House of Commons Library, SN/EP/4800, Table 2 (HMRC Hydrocarbon Oils Statistical Bulletin)
20 March 199019.49pUnleaded petrol duty rate set in the 1990 Budget.Source: House of Commons Library, SN/EP/4800, Table 2
19 March 199122.41pUnleaded petrol duty rate set in the 1991 Budget.Source: House of Commons Library, SN/EP/4800, Table 2
10 March 199223.42pUnleaded petrol duty rate set in the 1992 Budget.Source: House of Commons Library, SN/EP/4800, Table 2
16 March 199325.76pUnleaded petrol duty rate set in the March 1993 Budget.Source: House of Commons Library, SN/EP/4800, Table 2
30 November 199328.32pThe Autumn 1993 Budget committed to raising Fuel Duty by at least 3% above inflation every year (later raised to 5%, then 6%) — the policy that became known as the fuel duty escalator.Source: House of Commons Library, SN/EP/4800, Table 2
29 November 199430.44pEscalator-driven increase.Source: House of Commons Library, SN/EP/4800, Table 2
1 January 199531.32pRate change recorded by HMRC at the start of 1995.Source: House of Commons Library, SN/EP/4800, Table 2
28 November 199534.30pEscalator-driven increase.Source: House of Commons Library, SN/EP/4800, Table 2
26 November 199636.86pThe rate that was in force when the Labour government took office in May 1997.Source: House of Commons Library, SN/EP/4800, Table 2
2 July 199740.28pRate set in the new Labour government's first Budget, which increased the escalator commitment to 6% above inflation per year.Source: House of Commons Library, SN/EP/4800, Table 2
17 March 199843.99pEscalator-driven increase.Source: House of Commons Library, SN/EP/4800, Table 2
9 March 199947.21pThe last escalator-driven increase before the policy was discontinued.Source: House of Commons Library, SN/EP/4800, Table 2
21 March 200048.82pStandard unleaded petrol rate — the fuel duty escalator had already been abandoned by this point.Source: House of Commons Library, SN/EP/4800, Table 2
1 October 200047.82pFollowing the September 2000 fuel price protests, a new Ultra Low Sulphur Petrol (ULSP) duty rate was introduced below the standard unleaded rate, to encourage cleaner fuel. ULSP became the near-universal UK forecourt fuel within a few years, so from this point we track its rate as the headline figure.Source: House of Commons Library, SN/EP/4800, Table 2
7 March 200145.82pULSP rate cut in the 2001 Budget.Source: House of Commons Library, SN/EP/4800, Table 2
1 October 200347.10pThis is the same rate independently confirmed by GOV.UK's weekly road fuel prices series, which begins tracking from June 2003 — the two primary sources agree exactly.Source: House of Commons Library, SN/EP/4800, Table 2; cross-confirmed by GOV.UK/DESNZ weekly road fuel prices
7 December 200648.35pRate increase.Source: House of Commons Library, SN/EP/4800, Table 2
1 October 200750.35pThe last rate change directly documented in the 2008 House of Commons Library briefing; later changes below are sourced to GOV.UK's own weekly price series.Source: House of Commons Library, SN/EP/4800, Table 2
1 December 200852.35pWidely reported at the time as a duty increase timed to partially offset the temporary VAT cut (17.5% to 15%) introduced the same month, so the pump price effect of the VAT cut was smaller than it would otherwise have been.Source: GOV.UK/DESNZ weekly road fuel prices (first weekly report at this rate)
6 April 200954.19pRate increase.Source: GOV.UK/DESNZ weekly road fuel prices (first weekly report at this rate)
7 September 200956.19pRate increase.Source: GOV.UK/DESNZ weekly road fuel prices (first weekly report at this rate)
5 April 201057.19pRate increase.Source: GOV.UK/DESNZ weekly road fuel prices (first weekly report at this rate)
4 October 201058.19pRate increase.Source: GOV.UK/DESNZ weekly road fuel prices (first weekly report at this rate)
3 January 201158.95pRate increase — the peak rate before the 2011 Budget cut below.Source: GOV.UK/DESNZ weekly road fuel prices (first weekly report at this rate)