UK road fuel tax highest in EU

Despite four years of a fuel duty freeze

UK road fuel tax highest in EU - despite four years of a fuel duty freeze

UK road fuel tax highest in EU - despite four years of a fuel duty freeze

AA research reveals that the UK continues to levy the highest level of road fuel tax in the EU – despite four years of a fuel duty freeze.

Analysis of road fuel tax levels in Europe shows that, despite UK fuel duty being frozen at 57.95p since March 2011, drivers in this country still pay the biggest chunk (69%) per litre than those in other European countries.

With the Budget due on 18 March and fuel duty frozen until after the election, the AA challenges all political parties to commit in their election manifestos to:

  • A continued freeze on fuel duty – at least until it matches the average of the three highest levels of fuel tax in neighbouring EU countries.
  • Two-thirds of fuel duty receipts being ring-fenced for road improvements, maintenance, better gritting coverage, street lighting, green motoring infrastructure, cycleways and safer pavements.

Investment in roads

Meanwhile, AA members have called for two-thirds of fuel duty to be invested in roads – financing road resurfacing, repairs, drainage, cycleways, electric car infrastructure and other developments that would make road travel and mobility safer, cheaper, more reliable and less polluting.

How much motoring taxation should be spent on roads?

The AA-Populus survey of 19,303 AA members in mid October 2014 asked them what proportion of motoring taxation should be spent on roads, bearing in mind that motoring-related tax is a significant contributor to health, education, defence, social care and other government spending.

They replied:

1-10% of motoring taxation - 3% of the sample in favour

11-20% - 4%

21-30% - 6%

31-40% - 6%

41-50% - 15%

51-60% - 8%

61-70% - 9%

71-80% - 16%

81-90% - 9%

91-100% - 24%

Mean – 66.41% of motoring taxation

£26.5 billion in road fuel duty

In the past calendar year, government figures show that the UK has consumed 17.672 billion litres of petrol and 27.985 billion litres of diesel1. With fuel duty frozen at 57.95p a litre, the 45.7 billion litres of road fuel generated £26.5 billion in road fuel duty.

Two-thirds of fuel duty receipts alone would pump £17.7 billion into financing the UK’s roads – double what is currently spent in England.

Department for Transport statistics show that, in 2013/14, £3.156 billion was spent on national roads and £5.194 billion on local roads – a total of £8.35 billion.

Diverting £17.7 billion into roads-related expenditure would still leave £8.8 billion from the remainder of fuel duty receipts, £6.1 billion from vehicle excise duty, a further £9 billion from VAT on fuel, and £15 billion from VAT on car sales, company car tax and insurance premium tax – to go into general taxation2.

Department for Transport figures show that Highways Maintenance Funding in England will fall from £901 million next financial year to £801 million in 2017/18, with the prospect of £725 million in following years.

Allocations from the fund for roads will fall from 82.42% to 75% from 2018/19 onwards, when the fund will be split:

  • A roads 25%
  • B and C roads 25%
  • U roads 25%
  • Bridges 14%
  • Lighting 2%, and
  • Cycleways and Footways 9%.

Until 2018/19, the split is:

  • A roads 27.47%
  • B and C roads 27.47%
  • U roads 27.47%
  • Bridges 15.38%
  • Lighting 2.20%, and
  • Cycleways and Footways 0%3.

the fact that UK drivers still pay the highest level of fuel tax in the EU shows just how massively pumped up fuel duty was before the Coalition froze it

Edmund King, AA president

“AA members appreciate that, with huge swings in the price of petrol and diesel since 2011, the Government’s freeze on fuel duty hasn’t added to the burden on family and business finances. But, the fact that UK drivers still pay the highest level of fuel tax in the EU shows just how massively pumped up fuel duty was before the Coalition froze it,” says Edmund King, the AA’s president.

“It still generated more tax for the Government than business rates and only £400 million short of council tax receipts in 2013/144. Consequently, so many drivers are saying, rather than a cut in fuel duty, we want a continued freeze and more of it spent on what it is supposed to do: keeping UK roads fit for purpose, upgraded to meet new demands and making them safer.

"Drivers are sending out a strong message to all political parties that they could vote with their wheels unless there are clear commitments to fair taxation and expenditure .” 


(13 March 2015)

1. HMRC fuel duty receipts staistics

2. Transport Statistics Great Britain 2014 (page 277), Road Users Alliance (rua.org.uk)

3. https://www.gov.uk/government/publications/highways-maintenance-funding-allocations-201516-to-202021

https://www.gov.uk/government/news/6-billion-funding-to-tackle-potholes-and-improve-local-roads

4. Treasury – Autumn Statement 2014