Fuel duty: the 5p cut now lasts until 31 December 2026. Here's what happens next
By Juan Pedro Nguema · Updated
This article is being reviewed for updates.
In short: The 5p-per-litre cut in fuel duty, which was due to start ending on 1 September 2026, was extended to 31 December 2026. The current plan is for duty to rise in two steps in 2027. The Budget on 28 October 2026 could change these plans, so we'll update this page after it.
The rates (per litre, petrol and diesel)
| Period | Fuel duty |
|---|---|
| Now until 31 December 2026 | 52.95p |
| From 1 January 2027 | 55.95p |
| From 1 March 2027 | 57.95p |
The government announced the extension on 20 May 2026, saying it was a response to high fuel prices linked to the Iran war. It also extended a cut on red diesel (used by farmers and some businesses).
Why it matters
Fuel duty is a fixed tax on every litre. On top of it, you pay VAT at 20% on the total price, including the duty. So when duty goes up 3p, the pump price usually rises by more than 3p.
Example: filling a 50-litre tank:
- a 3p rise in duty ≈ £1.50 more in duty, plus VAT on it = about £1.80 more per fill;
- the full 5p ≈ £3.00 more per fill once VAT is added.
How to spend less on fuel
- Compare prices before you fill up. The government's Fuel Finder scheme makes forecourt prices easier to compare.
- Drive smoothly. Planning ahead and avoiding harsh braking and acceleration saves fuel (it's also part of the theory test).
- Check your tyre pressures. Under-inflated tyres waste fuel and affect braking.
- Take off empty roof boxes and bike racks. They add drag.
- Don't idle. If you'll be stopped for more than a couple of minutes, switch off (Highway Code Rule 123).
What to watch on 28 October
Fuel duty is decided at Budgets. We'll update this page with any change the Chancellor announces.
