Fuel duty in the U.K. would be going down by 5 pence a liter after the government announced new tax cuts to address inflation, which includes a future income tax relief.
“Overall, this is the biggest cut, in cash terms, that has ever been applied across all fuel duty rates at once,” the Treasury said in a statement on Wednesday.
British finance minister Rishi Sunak said in his budget announcement that the tax cut, which will save taxpayers up to £5 billion ($6.6 billion) during the next 12 months, will benefit almost 30 million working people and reduce their cost of living.
Meanwhile, income tax will be reduced by 1 pence to “let people keep more of what they earn.” The cut will be worth £5 billion for workers, savers, and pensioners, according to Sunak.
There will also be no VAT applied to energy-saving materials for the next five years including solar panels, heat pumps and insulation as electricity bills surge.
Britain’s inflation had accelerated to 6.2 percent in February, the highest rate in three decades, driven by existing price pressures from pandemic-induced supply problems and the recent Russian invasion in Ukraine.
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