Finance
UK's Reeves to freeze fuel duty until September 2026
Published by Global Banking & Finance Review®
Posted on November 26, 2025
1 min readLast updated: January 20, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on November 26, 2025
1 min readLast updated: January 20, 2026
UK finance minister Rachel Reeves extends the fuel duty freeze until 2026, maintaining the 5p cut. From 2027, rates will rise with inflation.
LONDON (Reuters) -British finance minister Rachel Reeves said on Wednesday she will maintain a freeze on the level of fuel duty rates until September 2026 when a five pence temporary cut introduced in 2022 will be reversed.
"I know that the cost of travelling to and from work is still too high ... so I am extending the 5p cut until September 2026," Reeves said in her budget speech to parliament.
From April 2027, fuel duty rates will then be uprated annually by inflation.
Duty paid on motor fuels has been frozen since 2011, except for a temporary cut introduced in 2022 when oil prices spiked after Russia’s invasion of Ukraine.
Fuel duty is a big revenue-raiser, bringing in around 25 billion pounds ($33 billion) a year.
($1 = 0.7586 pounds)
(Reporting by Andy Bruce, writing by James Davey, editing by Catarina Demony and Toby Chopra)
Inflation refers to the rate at which the general level of prices for goods and services rises, eroding purchasing power. It is typically measured by the Consumer Price Index (CPI).
A temporary tax cut is a reduction in tax rates that is intended to last for a limited period. It is often used to stimulate economic activity during downturns.
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