PRA welcomes fuel duty cut in UK budget

The Petrol Retailers Association (PRA) has welcomed key measures announced in the Autumn Budget 2026 regarding fuel duty and business rates, providing a generally positive response to the Chancellor’s fiscal plans. Chancellor John Healey confirmed that the existing 5p-per-litre cut on petrol and diesel will be extended until July 2027, successfully postponing a previously scheduled increase. Furthermore, the Small Business Rate Relief threshold for qualifying retail, hospitality, and leisure businesses will increase from £12,000 to £18,000 in rateable value, offering full relief starting April 1, 2027.

Expressing the association’s reaction, PRA executive director Gordon Balmer stated: “We are broadly pleased. The Chancellor has listened to our request to defer the planned fuel duty rise, which was due in January. The business rates relief increase will also help singleton forecourt operators with lower-value sites.” However, Balmer also cautioned that if fuel prices remain elevated, additional government action may still be required to shield motorists from rising transport costs.

Beyond fuel and business rates, the Budget introduced several other notable measures. The Government is launching a joint HM Treasury and HMRC consultation, closing on January 20, 2027, to examine expanding the Carbon Border Adjustment Mechanism (CBAM) to refinery products. This move aims to determine whether imported fuels should face carbon-related charges to counter the competitive advantage currently held by overseas refiners operating under lower environmental standards.

Additionally, workers will see wage increases starting April 2027, with the National Living Wage for those aged 21 and over rising by 3.9 percent to £13.20 per hour, and the National Minimum Wage for 18-to-20-year-olds rising by the same percentage to £11.27. In terms of business travel, the 55p tax-free business mileage rate for the first 10,000 miles has been made permanent, while the rate for mileage exceeding 10,000 miles will increase from 25p to 35p. Finally, the removal of tariffs on more than 100 imported food products, including items like baked beans, garlic, and confectionery, is expected to help reduce operational costs across parts of the convenience retail supply chain.