Osborne’s fourth budget scraps fuel-duty hike

Hard-pressed motorists received a bit of good news yesterday with the scrapping of the fuel duty hit planned for the autumn by chancellor George Osborne.

The rise would have seen the price of a litre of petrol and diesel go up by 3 pence at the pumps on the already high prices. With the step, the ruling coalition has now scrapped or frozen every scheduled fuel duty rise since 2010.

According to the Treasury, petrol was now 13 pence lower than it would have been under Labour.

Road tax for car drivers is now set to rise in line with RPI inflation, which would mean a hike of between £5 and £15 for the standard tax-rate of all but the very cleanest cars.

Road tax rates for new car buyers would increase in the first year from between £5 and £35 to a maximum £1,065 for the biggest 'gas guzzlers,' with drivers now having to pay 14 days 'grace' after the time their car tax was paid before having to display their tax disc. The current grace period is five days.

The good news for classic car drivers was that cars manufactured before 1 January 1974 would now be exempt  from road tax in an extension of current exemption by a year from 1973.

Meanhwhile, reacting to the budget presented by Osborne, which provided for the withdrawal of the fuel duty hike,  Labour leader Ed Miliband said, "This is the Chancellor's fourth Budget but one thing unites them all - every Budget, he comes to this House and things are worse not better for this country."

Among other budget highlights are  450,000 small businesses or one third of all employers would pay no National Insurance at all after introduction of Employment Allowance in April next year.  New Employment Allowance would take the first £2,000 off the employer's National Insurance bill of every company in the country.

Rise in personal allowance rates that exempt the first £10,000 of earnings from income tax.

Though escalation in duty on beer has been scrapped, planned increases for all other alcohol duties are in place.

Planned beer duty tax increase of 3p scrapped and replaced by a 1p cut in duty on a pint of beer.

To help people not able to afford a big deposit, new mortgage guarantee, sufficient for supporting £130 billion worth of loans has been proposed.