Fuel Duty Rise: What the Budget Changed, and When

Is fuel duty going up in 2026?

No. And under the Budget plans, it won't go up in January or March 2027 either. Fuel duty on petrol and diesel is 52.95p a litre, and it's set to stay there until 30 June 2027. From 1 July 2027 it's set to go to 60.59p a litre, in one step.

A rise was scheduled for 1 September 2026. The government announced on 20 May 2026 that it was dropping it, and the order doing that came into force on 15 June. Two more steps were then pencilled in, for 1 January and 1 March 2027. The Budget on 28 October 2026 announced that those are cancelled too.

The Treasury says it's scrapping the plan to add 5p back onto duty from January, and extending the cut by a further six months. It has also moved the inflation-linked rise to the same date, 1 July 2027. Both changes still need legislation, so they're announced rather than law. The Treasury says it will keep watching fuel prices over the coming months.

Duty is only one slice of the pump price, and one line in the cost of running a car. For the whole fuel bill and everything else that keeps a car on the road, read running costs of a used car.

The dates and the rates

Fuel duty is a flat charge per litre. It doesn't rise or fall with the price of the fuel itself.

The rate has been 52.95p since 23 March 2022, when a temporary 5p cut brought it down from 57.95p. That cut was meant to last 12 months. The Treasury says it has since been extended five times, including in May 2026, and it was extended again at this Budget.

Petrol and diesel carry exactly the same duty. That's been true for over twenty years. Diesel costs more at the pump for other reasons, not because the tax on it is higher.

The 57.95p figure is the rate written into the Hydrocarbon Oil Duties Act 1979, before the cut. The 1 July 2027 rate of 60.59p is that rate plus an inflation uprating, linked to RPI. The Budget pushed that uprating back to the same day. So from July, duty sits above where it was in early 2022, not level with it.

The government cancelled the inflation-linked rise for 2026 to 2027 at Budget 2025. The next one is now deferred to 1 July 2027, and it's built into the 60.59p.

Who this doesn't affect

Electric cars pay no fuel duty at all. HMRC's note says the tax excludes electricity, which is covered by the climate change levy instead. Car charging isn't in scope.

But watch the wording: it's the electricity that escapes, not the vehicle. A plug-in hybrid pays full duty on every litre of petrol it burns.

Biofuels get no discount either. Bioethanol and biodiesel are charged at the same 52.95p as petrol and diesel, so E10 petrol is no cheaper on tax than E5.

Red diesel is taxed far lower, but it's fenced off. Rebated fuel can only go in specific vehicles and machines, used for specific purposes, and HMRC lists them in Excise Notice 75. Putting it in a car on the road is an offence.

There's no regional escape either. Fuel duty is set UK-wide and isn't devolved, so the rate is identical in England, Scotland, Wales and Northern Ireland.

Gas is different again. LPG and natural gas are charged per kilogram rather than per litre, so any pence-per-litre figure on this page is about petrol and diesel only.

What a duty rise does to the price you pay

Duty isn't the last tax on a litre of fuel. VAT goes on top, and it's charged on the price including the duty. HMRC's VAT guide spells that out: for goods carrying excise duty, the taxable value is the price plus the duty.

That makes the maths easy: VAT is 20%, so every 1p of duty costs you 1.2p at the pump.

From 1 July 2027 the duty is set to go up by 7.64p a litre, from 52.95p to 60.59p. Add the VAT and that's about 9.2p a litre at the pump, all on one day.

Tax is already close to half of what you hand over. In the week commencing 26 October 2026, average unleaded petrol cost 174.07p a litre. Duty took 52.95p of that and VAT took another 29.01p, so roughly 47p in every pound was tax.

Diesel averaged 199.22p in the same week. Duty and VAT came to about 86.2p, or 43.2%. The share is smaller only because the fuel underneath it costs more.

Those pump prices move every week. Duty doesn't. Our running costs guide tracks the weekly picture, and what it means for a whole year's fuel bill.

What it costs you in pounds

These are estimates, not measurements. They assume the full 9.2p reaches the pump, that you drive a petrol car averaging 45mpg, and that fuel prices are otherwise flat. Change any of those and so does the number.

A 55-litre tank costs about £5.04 more to fill. A diesel car doing 12,000 miles at 55mpg comes to around £91 a year.

It all arrives on one day, 1 July 2027. Nothing is set to change before then, so 2027 itself only carries six months of it.

I'd treat these as a rough steer and nothing firmer. The mpg figure is the weak link, because real-world economy swings hugely with the car and the driving.

That's the real limit of any figure on this page. A national average tells you nothing about the car on your drive.

That's what our free car check is for. Put in a number plate and you get a running-cost estimate for that vehicle, plus its MOT and tax record.

Should you actually worry about this?

Honestly, only a little. About 9p a litre is real money and worth knowing about, but set against the rest of what a car costs it's a small line.

Put the numbers side by side. The July rise costs a typical driver somewhere near £111 a year. Insurance and servicing both run to hundreds, and one unexpected repair can beat the lot.

And depreciation usually dwarfs all of them. It's the cost you never write a cheque for, which is exactly why buyers underrate it.

So the sensible response isn't to change what you drive over a few pence. Budget for it, and put your attention on the bigger lines. Fuel duty was only one line in the Budget, too: here's what else the Budget changed for drivers.

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