Hull MP calls for VAT rise on fuel to be reversed

Hull North Labour MP Diana Johnson is calling on the Chancellor George Osborne to reverse the Government's VAT rise on fuel.

January's hike in VAT to 20% added nearly 3p to the price of a litre of petrol and will raise £700m for the Treasury, according to figures from the independent House of Commons Library.

The Labour Party wants the VAT rise on petrol to be reversed immediately, using the £800m extra that the Government is now getting from the bank levy, compared to what it was expecting in the last Budget.

Labour has launched an online petition at www.reversevatonfuel.com, which calls for the Coalition's January VAT hike on fuel to be reversed and for the annual rise in fuel duty to also be looked at again, in light of the global surge in oil prices.

The Budget takes place on 23 March.

Diana Johnson MP said: "I've consistently opposed the Conservative-led Government's VAT rise, which has hit Hull families hard and helped to push up petrol prices to record levels.

"It's time the Chancellor George Osborne took immediate action on fuel prices to ease the pressure on families who are already facing a tough year, with incomes squeezed and prices rising.

"He should immediately reverse the VAT rise on fuel, which has added nearly 3p to the price of a litre of petrol, using the extra £800m the Treasury will be getting from the bank levy. People across Hull can sign Labour's petition to the Chancellor at www.reversevatonfuel.com.

"In the Budget later this month George Osborne should also look again at the annual fuel duty rise due in April. The last Labour Government often postponed planned duty increases when world oil prices were on the up - as they are now. The Tories promised a 'fuel duty stabiliser' to win votes before the General Election, but if they don't deliver one it will be another Coalition broken promise. Lib Dems even campaigned against VAT increases before General Election, in full knowledge of the deficit, only to back the VAT hike once in Government.

"The AA's latest fuel price report shows that across Yorkshire and Humberside the average cost of a litre of unleaded petrol in February was 127.8p up 6.6p compared to December, before the VAT rise. The current instability in the Middle East and North Africa is driving up oil prices around the world, meaning the price of petrol at the pump continues to rise.

"Now is the wrong time to be making life even worse for hard-pressed families in Hull by hiking up VAT, as this Government has done. With pothole repairs being cut Hull motorists are getting a raw deal for all this extra tax."

Shadow chancellor Ed Balls MP added: "I hope people across Hull will back our campaign and send a message to the Chancellor George Osborne that he needs to act immediately to reverse the VAT rise on fuel. It's the wrong tax at the wrong time and is hitting families and businesses hard.

"George Osborne also needs to come up with a plan to get our stalled economy moving again and get more people into work making their contribution and paying taxes. That's the best way to get the deficit down and ease the pressure on families facing the squeeze."

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