Drivers handed £130 each starting today but warn it's a 'huge mistake'

Petrol and diesel drivers face an extension of a freeze in fuel duty - which experts are warning is a "mistake" from Labour Party Chancellor Rachel Reeves. A leading motoring expert has criticised the government for its decision to "ignore fuel tax".

Thom Groot, CEO of The Electric Car Scheme, said: "Ignoring fuel tax in the Budget is a huge mistake. We are 14 years overdue for a fuel tax increase, and the subsidising of fossil fuels needs to end if we are to reach our net zero and ZEV targets."

The comments come after the RAC predicted it would save motorists £130. Mr Groot said: "The £100billion this freeze has cost the Treasury so far, invested properly, could have been transformative to the NHS, infrastructure or just the national debt and there is no excuse for extending it." Mr Groot added: "The £20billion black hole that has dominated headlines cannot be filled at the cost of the net zero transition, it would be madness to do so.

READ MORE Petrol and diesel drivers being handed free £130 from today under Labour

"Not to mention the cost to the NHS of poor air quality and extra funding freed up by ending this subsidy. Introducing a levee on aviation fuel would also increase the tax take and help tackle climate change." RAC head of policy, Simon Williams, said: “Drivers will breathe an enormous sigh of relief after all the speculation that the 5p cut would be scrapped at the same time as pushing duty up beyond the long-term rate of 57.95p.”

The Government says it will also facilitate competition in the road fuels market, improve transparency and empower drivers to find the cheapest fuel prices by accepting the Competition and Markets Authority’s recommendations to implement Fuel Finder, an open data scheme for fuel prices and a market monitoring function by the end of 2025.

The government will change the VED First Year Rates for new cars registered on or after 1 April 2025 to strengthen incentives to purchase zero emission and electric cars, by widening the differentials between zero emission, hybrid and internal combustion engine (ICE) cars.