Fuel duty increase postponed again

The planned two pence increase in fuel duty planned for October has been postponed for the second time, with rising oil prices cited as the reason.

This second delay follows the decision to postpone the increase for six months from March, to the 'new' date of October. This, of course, has now been moved again.

Chancellor Alistair Darling said: "The global credit crunch and sharp rise in world oil prices have pushed up prices at the pump. Today's decision will help motorists and businesses get through what is a difficult time for everyone.

"This measure is taken in response to sharp rises in world commodity prices, with the price of oil almost doubling over the past year to reach a real-terms record high of $146 a barrel recently."

The RAC was pleased with the news, but said it still wasn't good enough: "This is welcome news but it does not go far enough. We would like to see the chancellor not just postpone future rises but actually cut fuel duty."

A series of protests by lorry drivers against the decision are believed to have made an impression on the government, with prime minister Gordon Brown admitting earlier this month that the delay announced today was a distinct possibility, something that the government was looking at "very, very carefully".

Yesterday, David Cameron unveiled Tory plans for tax duty to fall with rising oil prices.

He said: "At the moment, tax revenues rise and fall with the oil price.

"The increase in revenues from the North Sea more than offset any dampening impact high oil prices will have on tax receipts from the wider economy."

He added: "Oil goes up, the tax goes up, people feel all the pain - and the government gets all the gain. A fair fuel stabiliser will end that."