Government announces changes in alternative fuel duty rates

Wed 04 February 2004 View all news

The duty benefit for liquefied petroleum gas (LPG) is reduced by 1p/litre in 2004-5 and by a further 1p/litre in each of the next two years, following the Budget 2004 announcement. The duty rate for natural gas as a transport fuel will remain at the current level until 2007.


The Budget statement confirms the Government’s intention to provide greater certainty to investors in alternative fuels and vehicles by announcing duty differentials for a rolling three-year period.


The Chancellor also announced that the 20p duty differential in favour of biodiesel will be maintained until at least 2007, and that a similar rate for bioethanol will be introduced from January 2005. The Government will stage a consultation over the summer to examine biofuels taxation in greater detail.

Related Links

HM Treasury: Budget, Environment Section

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