Well, I am at a loss to understand how this is going to work. 1p off petrol hardly makes a difference. As Ed petrie tweeted in two tweets today:



He’s echoing Ed Balls, who said:

http://www.bbc.co.uk/news/business-12844157

Which is interesting, but does the fuel stabiliser actually functional? What is to stop the petrol companies passing on the tax rise to the customer at the pump?



So, if the North Sea OIl companies are separate to those selling fuel at the pump, then what is going on? Surely you need to tax the oil companies directly? I find myself bewildered by this apparent tangle of taxation. If the tax increase to North Sea OIl is not passed on at the pump, it will be passed on in other ways. Oil companies are wily things, and they will no doubt find ways to circumnavigate these tax rises.

So, right now, I’m looking at the 1p reduction and wondering what good that will do people. A 45p saving at the pump for a fill-up isn’t much, and I suspect it will be wiped out by another increase in the price of crude in a few days time.

Am I wrong about any of this? I find this a rather confusing tangle to unpick this morning. I thought a sleep on it sould help straighten the kinks out of my understanding, but so far, I’ve not managed to make it make sense to myself.

I think Gideon should have cut VAT on fuel.

We're charged fuel duty and VAT on what we take at the pump. Even cutting the VAT to the amount they charge for domestic gas and electricity would have helped.

Nobody knows yet, it was only announced yesterday...


Same companies, different drill holes. North Sea oil is actually crap for petrol, it's far too 'heavy' so when you fractionate it you get relatively little petrol out but lots of other stuff. In actuality, the extra taxation will make next to no difference to the bottom line of the companies who extract the stuff from the ground, they make most of their profit elsewhere - remember before the government adds their cut, a litre of petrol only costs about 30p. There is also the fact there are many intermediate steps between pulling the stuff out of the ground and it going in your tank - what gets pumped out of the ground gets sold & resold about four times before it ends up at the petrol station. It's not just one company that has the pass the cost on, it's every company at every stage. Whether that will happen or not... well, nobody knows frankly.


Well it assumes that the company pays tax in the UK at all for starters. Curious George just changed the rules so a lot of companies don't have to any more.


Feck all, regardless of whether the increase in 'back end taxes' gets passed on or not. 1p off 135p is frankly neither here nor there. And expecting to get any credit for not putting on a tax rise when you're getting 50% more tax revenue from petrol sales than you were a year ago anyway is just taking the biscuit.


It's simple - at the start of the budget he said the whole thing was 'fiscally neutral'. That means he's not giving anything new away, but he's not taking anything new off you either overall. The average tax burden remains the same. The changes to income tax thresholds will make much more of a difference to your pocket than the tinkering with petrol prices does either way. If you're poor you will be ever so slightly better off, if you're rich you will be ever so slightly worse off but in the grand scheme of things, you probably won't notice compared to how much prices & etc are going up anyway, which has nothing to do with what happened yesterday.

Jon

IIRC, during the budget speech, it was mentioned that this would have been illegal.
No explanation was forthcoming, of course.

http://newsthump.com/2011/03/24/motoris ... n-tuesday/

There has been a substantial cut in the taxes overall on fuel. Much more is taken by the oil companies now. I suspect that if the oil companies could get away with it they would increase the price anyway.

I see today that it’s 6p off we are getting. You see, we have forgotten to include a FUTURE increase in petrol prices - the 5p due in April which has been cancelled. So we’re 6p better off at the pump today.

Feeling the love? Watch squeaky-boy explain it:
http://www.bbc.co.uk/news/business-12844157

Not cancelled - only postponed for a year.

Jon

Like I said elsewhere, that 1p off (aside from not being 1p off because of the rises and VAT increase) was obliterated by petrol stations raising their prices by 1p before the announcement.

Rather than dancing around it he could just change the VAT rate on fuel. It's done for other things. That is if they really wanted to help.

It's too late for some.

http://www.bbc.co.uk/news/uk-england-kent-12803498

A shame. The BBC’s piece that they did in Watford a couple of months ago was raising similar problems there. A local haulier was looking like they were close to the edge then. I wonder if they will be able to ride this out. I suspect that they’ll be laying off staff soon.

Given the current fluctuations in fuel prices, 1p more or less doesn't make a whole lot of difference, we get a variation of around 11p a week here at the moment.

Variation?

Here, it's become a relentless rise. It never goes down. Ever. To think, only last year, I was complaining the prices were hitting £1.13 a litre.

The usually-guaranteed cheapest fuel round here is Morrisons. Last time I looked unleaded was £1.32 a litre. That's £46 to fill my little car's tank. When I was working in the Bat Cave, that was a fortnight's motoring. £100 a month on fuel would be completely unsustainable for me at the moment.

So, while I am "self employed", journeys requiring the car are once or twice a week, and not much more than getting the weekly groceries. We plan journeys to hit as many places as possible in the shortest route.

Of course, this is probably a Good Thing as far as personal pollution is concerned. It is cramping my style a bit, though. No on-the-spur-of-the-moment day trips anywhere more than a few miles away. No random trips to visit family, unless we can build in other visits as well to make it worth the tank of fuel it will cost.

I'm looking for a job, but it's going to have to pay a healthy salary before I decide to accept a position - unless it's a cycle ride away.

I have to admit I was wrong for pointing the finger at the petrol stations. I was under the assumption the Chancellor was competent.

Turns out he, nor Danny Alexander, have had any contact with the industry even though they've written to him and asked for meetings about any changes or potential changes. Turns out we have a bigger problem, the Chancellor is a halfwit and did not know that the 1p reduction could not have happened at 6pm on the day of the announcement because any of the fuel in the tanks had already had the Duty paid on it.

Unless the industry could time travel they could not take 1p off at the time. The Chancellor is a fool.