UK Fuel Duty

How much Fuel Duty do we pay for Petrol ? (2012)

In the UK there is a fuel duty that is applied to all Hydrocarbon fuels, including unleaded petrol, diesel, LPG, biodiesel, bioethanol and other fuels that are used in cars.

The rate of the fuel duty is usually set during the buget, and consist of an additional tax that is applied to the petrol before it is sold. This fuel duty is applied before VAT, so whenever the fuel duty rate is raised, additional VAT is placed on top of it.

The fuel duty and the VAT level are shown in the table below, these levels have been fairly consistant for a while, and infact are 1p lower than the levels in Jan 2011. However they are due to increase by 3p a litre of unleaded and diesel and a massive 6p per kg for LPG in August 2012.


Type of Fuel
Total Cost at Pump
Fuel Duty
% of Fuel Cost that is Tax


Note that in January 2011 there will be an additional 0.76p/litre duty added to all 3 of the fuels above, on top of a VAT increase to 20% (from 17.5%). If the non taxed part of fuel prices stays the same this will mean a total increase of around 3.3p/litre for unleaded and diesel, and 2.2p for LPG


For comparison back in September 2009 the price of fuel, the fuel duty and the VAT level are shown below:

Type of Fuel
Total Cost at Pump
Fuel Duty
% of Fuel Cost that is Tax

LPG used to enjoy a much lower fuel duty a few years ago when it was classed in the same category as Biodiesel and Bioethanol fuels, which have a fuel duty rate of a  mere 36.19p.

Effect of Fuel Duty on Petrol Prices


For the avoidance of any doubt, if there were no fuel duty on unleaded or diesel then the price at our pumps would be around 61p, and if there were no VAT to pay this would be reduced to just over 48p/litre.

The full report on the government budget relating to Fuel Duty can be found here:

Other Taxes on Driving

Of course fuel duty is not the only tax we pay in order to drive our cars, there is the Car Road Tax as well.

Use the form below to find out your car CO2 emissions and hence which car tax band you are in. The form also shows you how many miles to the gallon you get. More miles to the gallon = buy less petrol.

UK Car Tax Bands Charges

The following table shows the UK Car Road Tax charges for 2006-2009, along with some common cars that are in each band. As you can clearly see the less fuel that you consume (and hence do less damage to the environment) the cheaper your car tax will be.

The 2007 budget lays out increased for the highest polluting cars (band G) who will have their car tax increased to £300 for 2007/08 and to £400 for 08/09, whilst the least polluting cars will have the duty cut to £35 (band B) or if you have a band A car will still have zero car tax.

Cars in the C-E band will have their car tax increased by £5, whilst band F will be increased by £10 to £200. Similar increases will apply the following year also.

Car Road Tax Details

Car Tax Group

Car Carbon Emissions

06/07 Car

07/08 Car

08/09 Car


Typical vehicle in
this tax band

A <100g/km £0 £0 £0 Smart Diesel
B 101-120g/km £40 £35 £35 Toyota Prius
C 121-150g/km £100 £115 £120 Ford Focus (diesel)
D 151-165g/km £125 £140 £145 Mini One hatchback 1.6 (petrol)
E 166-185g/km £150 £165 £170 For Mondeo 1.8i (petrol)
F 186-225g/km £190 £205 £210 Freelander 2.0 diesel
G >225g/km £210 £300 £400 Jaguar X type 2.0


The Budget Speech in 2008 by Alistair Darling announced a new car tax system for 2009-10 and 2010-11 as shown below.


Tax Band CO2 Emissions
standard rate (£)
first year rate (£)
standard rate (£)
 A  0-100  0  0  0 
 B  101-110  20  0  20
 C  111-120  30  0  35
 D  121-130  90  0  95
 E  131-140  110  115  115
 F  141-150  120  125  125
 G  151-160  150  155  155
 H  161-170  175  250  180
 I  171-180  205  300  210
 J  181-200  260  425  270
 K  201-225  300  550  310
 L  226-255  415  750  430
 M  225+  440  950  455


Car tax is designed to try to encourage car buyers to purchase more environmentally friendly cars. When we say lower car tax for environmentally friendly cars we are simply talking about how many grammes of CO2 the car will emit per km rather than its impact as a whole (maufacture cost, how recyclable it is, cost of repair). The lower the CO2 level the lower the car tax. This is a growing trend with the UK government, with fuel duty increasing to encourage better fuel efficiency, European legislation to force car companies to produce more efficent cars, and local  congestion charges that penalise gas guzzling vehicles. But will it really make a difference? The British are in love with their cars, and if someone has forked out tens of thousands of pounds on a Jaguar, are they really going to care about a few hundred pounds worth of Car Tax?