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Fuel duty increase will hinder growth, says AA

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The latest rise in fuel duty could have an adverse impact on the recovery, motoring organisation, the AA, has claimed.

As from 1 October, an additional 1p is being levied per litre of petrol and diesel.

But Edmund King, president of the AA, argued that now is not the time to impose extra fuel costs.

He said: “This fuel duty increase highlights a series of contradictions that make it hard for drivers to accept.

“Pushing the petrol price almost to a level of the 2008 record high could backfire as it will hinder economic growth.”

Mr King went on to say that petrol and diesel prices are at least 10p a litre higher than this time last year.

The AA’s criticism of the move was backed by the Freight Transport Association (FTA).

The FTA put the cost of the latest rise to the transport industry at £125 million annually.

Simon Chapman, the FTA’s chief economist, added: “With another rise due in January and above-inflation rises set for the next three years, many businesses hit hard by the recent recession will feel like they are on borrowed time.

“The price of oil is the highest it’s been for three months and is set to rise further as we come into the autumn peak period of oil demand. With economic recovery still so fragile, now is not the time to compound the problem with artificial price hikes.”