Chancellor hints at fuel duty cut

Chancellor George Osborne has said he was looking at the possibility of overriding the 1p rise in fuel duty due to come into effect in April.

The Government has come under pressure from motorists to scrap the rise as the cost of a litre of unleaded soared to almost £1.30 thanks to high global oil prices and this month's VAT hike to 20%.

Fuel duty already eats up 58.95p for every litre, on top of VAT of more than 20p. Labour chancellor Alistair Darling announced a further 1p rise this April in last year's Budget.

Asked during a visit to the West Midlands today whether he could do anything about the planned duty hike, Mr Osborne told BBC WM radio: "We can override it, we are looking at that."

The Chancellor appeared to indicate that any relief for motorists may be announced in his March 23 Budget, saying that "if we are able to do something about it we will do it before April".

Mr Osborne also confirmed that ministers were looking into the idea of a fuel stabiliser, so "the Government steps in to try to protect people from the effects" of volatility at the pumps by cutting the level of duty as oil prices rise and increasing it as they fall.

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