Planned rise in fuel duty is axed

UK motorists have received a £500 million boost following the Chancellor's decision to scrap August's planned 3p rise in fuel duty.

Speaking in the Commons, George Osborne declared that fuel duty will now be 10p a litre lower than it would under the plans inherited from Labour. He also announced that the tax would be frozen for the rest of the year.

The boost can be paid for as a result of larger-than-expected savings in departmental budgets across Whitehall, said the Treasury.

Owning a car is already an expensive business, what with having to pay necessities such as road tax and car insurance, so Mr Osborne said this move is a sign the Government is "doing everything we can in very, very difficult economic circumstances for the world".

The Chancellor had been under pressure for some time to scrap the rise, with shadow chancellor Ed Balls leading calls for the Government to use the £500 million underspend from the Olympics to fund the move.

Copyright © Press Association 2012.