Hunt extends fuel duty freeze and raises premium air passenger duty

Chancellor Jeremy Hunt provided a boon to motorists and prompted the airline industry to warn of higher fares with the transportation measures he announced in the Budget. In a bid to ease cost-of-living pressures in the run-up to the general election expected later this year, Hunt said he would maintain the 5p cut on fuel duty and freeze the charge for another 12 months. It is the 14th consecutive year in which the level of the duty has not been increased. But motoring groups criticised a “missed opportunity” to incentivise uptake of electric vehicles, which has slowed, and pointed out that petrol prices had risen to an “unheard of” level. In contrast, air passenger duty will be increased for non-economy travel to account for higher inflation in recent years. For premium travel on flights over 5,500 miles, the levy will go up to GBP224 from GBP200. For flights between 2,001 and 5,500 miles, the duty will rise from GBP191 to GBP216, while the tax on journeys of less than 2,000 miles will rise from GBP26 to GBP28. Airlines have reported a boom in business and first-class flying since the end of the pandemic, as high-spending holidaymakers make up for a decline in corporate travel. But industry bosses accused the government of breaking a promise not to discourage people from flying by raising taxes on the sector. “The prime minister has broken the pledge he made . . . not to raise taxes on flying,” said Willie Walsh, former British Airways boss and head of global airline lobby group Iata. “It’s a short-sighted cash-grab of a government that has run out of ideas, competence and basic integrity.”<br/>