Rail Fares Cap, Fuel Duty Freeze, APD Increase
Rail passengers and motorists have been given good news this week, but air passengers will be faced with increasing prices. This come as Chancellor George Osborne announced in his Autumn Statement a cap for rail fares, a fuel duty freeze and a green light for APD to rise.
In January, regulated rail fares will rise 6.2%, which is 1% more than the RPI rate of inflation. This is better than the previously planned 8.2% ticket price increase, which was 3% over inflation. The decision to reduce the price hike will apply to London Buses, Tube fares and all National Rail regulated tickets. This means the government is avoiding the double-digit rises of past years. Although this will help millions of people, rail commuters will still be faced with considerable increases in prices.
The 3p per litre rise in fuel duty that had been planned for January has now been axed, while the 5p rise scheduled for August has now been reduced to 3p. The cost of oil has pushed pump prices near 150p per litre this year, and although prices have fallen in recent weeks, the average is still at historic highs for regular fuel at 133.1p and diesel at 141.3p. Osborne says that the decision will help families save an average of £144 per year on filling up.
However, the planned Air Passenger Duty (APD) increase on April 1 has been given the go ahead, which will see the tax rise about 10% - double the rate of inflation. This means a family of four travelling to the US will have to add an extra £24 to the £240 they are already taxed. The Treasury says that an announcement will be made next week to address possible changes to the controversial banding system that determines the amount of duty that passengers are charged.