Rishi Sunak slashes fuel duty by 5p cutting £3.30 off the cost of filling up a tank from 6pm TONIGHT

The Chancellor said: "Today I can announce that for only the second time in 20 years, fuel duty will be cut.

"Not by one, not even by two, but by five pence per litre. The biggest cut to all fuel duty rates – ever. 

"And while some have called for the cut to last until August, I have decided it will be in place until March next year – a full 12 months.

"Together with the freeze, it’s a tax cut this year for hard-working families and businesses worth over £5bn. And it will take effect from 6pm tonight."

It comes as petrol prices have soared to new record highs, with a litre of unleaded now costing 167.3p and diesel 179.7p, according to the RAC.

Gerry Myton, Partner at HW Fisher said: "A 5p cut in the rate of duty should equate to 6p at the pumps. "This is because the cost price of the goods reduces, so the amount of VAT you pay falls."

VAT is currently at 20% - an extra penny on a 5p cut.

There have been calls on Rishi in recent days to help families grappling a cost of living crisis.

Latest data issued today showed inflation had hit 6.2% - its highest level since March 1992.

The ONS said energy, fuel and food price rises were the biggest contributors to the latest inflation rate increase.

Meanwhile, workers' wages are not keeping pace with inflation, meaning pay packets need to stretch further to afford the same things as a year ago.

There have been calls in recent days for the Chancellor to do more to help families as tax receipts have given him "wiggle room" to assist.

Yesterday the Office for National Statistics (ONS) said the Treasury collected £53.7billion in taxes last month, up more than £4billion on 2021.

Borrowing was a record £138.4billion, but still £21.2billion below the figure predicted by the Office for Budget Responsibility.

Former OBR boss Sir Charlie Bean said inflation had given Mr Sunak plenty of money to “play with” today to try ease the pain of hard up Brits.

More misery for motorists

There's been more misery for motorists in recent weeks as petrol prices have hit a string of record highs.

This week, the cost of filling up an average family car topped £100 for the first time due to rocketing oil prices.

A 5p-a-litre price cut will bring the cost of a fill-up down by around £3.30 a time.

If you fuel up once a fortnight, that's around £86 a year.

And the ONS revealed that the Treasury had raked in £4.5billion more from motorists last year.

Drivers paid £24billion in fuel duty — up from £19.5billion in 2021 when fewer people were on the roads.

Our Keep It Down campaign has campaigned for a cut to the levy for more than 12 years.

Howard Cox, founder of campaigners FairFuelUK, said: “The Chancellor is awash with fuel tax revenue.”

It came as Cabinet minister George Eustace hinted that costly policies on net zero, climate change and tackling obesity will be kicked into the into the long grass as Brits face a cash squeeze.

New regulations could be paused, or ditched, as part of a fresh review.

How to keep petrol costs down

Simple measures such as keeping your tyres at the correct pressure and not accelerating or braking sharply can help your fuel go further.

You can also save money at the pump by only topping up with the fuel you need - a full up tank will add unnecessary weight to your car.

Website  can help you find the cheapest petrol station near you.

You need to register with the site, enter your postcode and tell it how far you're willing to travel for fuel (up to 20 miles) and what fuel type you're after.

Various stations offer fuel loyalty cards, which can help you save on the cost of filling up.

And a very simple fuel pump trick can help make sure you never put too much petrol in your car.