Oil price reductions and excise duty
O’Malley asked how the oil price reductions would be divided between the Exchequer and consumers. Dukes said excise increases would absorb some of the reduction, while retail prices were still reduced from 5 April.
asked the Minister for Finance the proportion of the impending reductions in oil prices which will go to the Exchequer; and the proportion if any, that will go to the consumer.
Comment on this
: As I indicated in my Budget Statement, the Government propose to absorb some of the reduction by increasing the excise duty on petrol and other road vehicle fuels and provision was made for a yield of £15 million this year from this source.
With effect from 1 April 1983 excise duty on road fuels was increased as follows by means of a Government order: petrol, 6p per gallon (incl. VAT); road diesel, 4p per gallon (incl. VAT); auto-LPG, 3p per gallon.
Notwithstanding these tax increases the retail price of oil products was reduced as follows, with effect from 5 April 1983: petrol, 9.4p per gallon; road diesel 4.4p per gallon; gas/diesel oil, 6.8p per gallon; fuel oil, 1.6p per gallon.
For example, in the case of petrol a duty increase of 6p was followed by a net price reduction of 9.4p so that the extra take to the Exchequer on that basis was 6p out of a potential 15.4p.