AA Credit Card Can Help With VAT Increase

Help ease New Year fuel price pain

The cost of petrol and diesel fuel has reached a record high, with petrol costing on average 15.32p and diesel 17.79p per litre more than in December last year*, before the January price rises according to AA Financial Services. The New Year sees a further leap with the cost of a litre of unleaded petrol rising by a further 3.5p with increases in both fuel duty and VAT** from 4 January.

Mark Huggins, director of AA Financial Services commented, "The AA's figures show that the cost of fuel has risen by more than 15p per litre over the past year, adding over £32.50 to the monthly petrol bill of a two-car family. Coupled with the January price rises this is putting huge pressure on many household budgets."

AA Credit Card generous reward scheme

The AA's Credit Card can help keep the cost of motoring in check, Huggins suggests. The card offers a generous reward points system and AA members can earn the equivalent of 4% back on the AA Credit Card reward scheme when they redeem points earned on motoring or fuel spending* against other AA products. However, AA reward points can be redeemed on a wide range of goods, including AA products, high street shopping vouchers, wine, days out or cash back.

"Using the AA Credit Card for all fuel purchases helps to combat these increases in cost. In addition to the introductory 0% on purchases for 10 months (APR 16.9% typical rate variable)***, the card earns double points on the purchase of fuel, including that bought from supermarket filling stations while AA members earn points at twice the rate of non-members," Huggins points out. "You could help lighten the New Year load by taking out an AA Credit Card and start earning points straight away."

The AA Credit Card can be applied for at theAA.com where there is a useful calculator that enables users to work out their points-earning potential. The following examples show how families, with or without AA membership, can make savings by switching their everyday spending to the AA Credit Card.

Family 1

An AA Member – using card only for fuel purchases, over one year, 15,000 miles assuming average 35mpg, total 1,948 litres

  • Total cost assuming an average price over the past year of 119p per litre, total cost £2,318.12
  • Fuel points earned: 4,636

And if in addition they spent £250 per month for normal shopping – ie groceries, luxuries etc: £3,000

  • Non-fuel points earned: 3,000
  • Total points earned: 7,636

Family 2

Non-member – using card (same purchase pattern as above)

  • Fuel points earned: 2,318
  • Non-fuel points earned: 1,500
  • Total points earned: 3,818


Rewards redeemed for shopping voucher

  • AA Member: worth £76
  • Non-member: worth £38

Rewards redeemed for contribution towards cost of AA car insurance

  • AA Member: worth £152
  • Non-member: worth £76

* Based on average fuel prices as at 10 December 2010: cost of a litre of unleaded petrol: 121.76p; diesel 125.73p (source: AA)

** Fuel duty increases by 0.76p on 1 January while the increase in VAT adds approx. a further 2p

*** Check the current rate on our website.