Question to the HM Treasury:

To ask the Chancellor of the Exchequer, whether his Department has made an assessment of the potential merits of introducing tax rebates on VAT for key workers in respect of petrol and diesel purchases for travel to work.

In response to fuel prices reaching their highest ever levels, the Government announced at Spring Statement 2022 a temporary 12-month cut to duty on petrol and diesel of 5p per litre across the UK. This cut represents savings for households and businesses worth around £2.4 billion in 2022-23.

VAT has been designed as a broad-based tax on consumption and the twenty per cent standard rate applies to the vast majority of goods and services, including VAT on road fuel. Whilst there are exceptions to the standard rate, these have always been strictly limited by both legal and fiscal considerations.

A key principle of the VAT system is that similar supplies are subject to similar levels of VAT. The Government keeps all taxes under constant review, but there are no plans to offer VAT rebates on fuel for key workers.