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Part of the special edition: Autumn Budget 2026: what it means for you

What's changingShopping & value

Budget 2026 for drivers and shoppers: fuel duty, car tax, EV charging, £2 bus fares and food tariffs

Fuel duty stays at 52.95p a litre until the end of June 2027, then rises to 60.59p. Car tax goes up in April 2027, single bus fares in England outside London are capped at £2 through 2027, and tariffs on over 100 foods are suspended.

Published 28 October 2026Last checked 28 October 2026UK-wideFrom HM Treasury and HMRC

A petrol pump nozzle resting beside a coiled electric charging cable on a wet forecourt at dusk, with a red bus shelter in the background.

Illustration generated with AI

What's happening

The 5p cut in fuel duty, which was due to start ending in January 2027, now lasts until 30 June 2027. On 1 July 2027 duty returns to its pre-2022 level and rises with inflation, taking petrol and diesel from 52.95p to 60.59p a litre. The standard rate of car tax (Vehicle Excise Duty) goes from £200 to £210 a year from 1 April 2027. VAT on public EV charging is 20% from 1 November 2026, and a pay-per-mile tax on electric cars starts in April 2028. Single bus fares in England outside London are capped at £2 for 2027. Tariffs on over 100 imported foods are suspended until December 2028.

The question: What does the Budget mean for the cost of driving, buses and the weekly shop?

This applies to you if…

  • You drive a petrol or diesel car
  • You own an electric or plug-in hybrid car, especially if you charge on the street
  • You take buses in England outside London
  • You buy food, drink, cigarettes or alcohol

Not for you if…

  • Bus users in London, Scotland, Wales and Northern Ireland, who are outside the £2 cap described in the Treasury analysis

What it's worth

What it's worth: From a few pence to a few pounds a week, depending on how much you drive and shop

Fuel duty 52.95p a litre to 30 June 2027 and 60.59p from 1 July 2027 (Annex A). VED standard rate £210 in 2027 to 2028 (Annex A).

Tax year 2026 to 2027 and 2027 to 2028

Illustrative calc: fuel duty on a 50 litre fill

  1. Until 30 June 2027 duty is 52.95p a litre. On 50 litres that is £26.48.
  2. From 1 July 2027 it is 60.59p a litre. On 50 litres that is £30.30.
  3. That is £3.82 more in duty, and VAT at 20% on top makes about £4.58.
  4. Under the previous plan the 5p would have started coming back from January 2027, which on 50 litres is £2.50 of duty, or £3 with VAT.

About £4.58 more per 50 litres from July 2027 than now, if pump prices change only by the duty

Illustrative calc. Pump prices also depend on oil prices and retailers, so the actual change could be different.

How to do it

  1. 1

    Check your car tax renewal date

    New VED rates apply from 1 April 2027. The standard rate for most cars registered since April 2017 is £210 in 2027 to 2028.

    Takes about 5 minutes

  2. 2

    If you charge an EV in public, check the price per kWh

    Electricity from public chargers is standard rated for VAT at 20% from 1 November 2026. The government is putting £100 million into cutting costs at local, lower-powered chargers from spring 2027.

    Takes about 5 minutes

  3. 3

    Look up local bus fares

    The £2 cap on single fares in England outside London runs for one year from 1 January 2027, according to the Treasury's household analysis.

    Takes about 5 minutes

The catches

Fuel duty jumps in July 2027

On 1 July 2027 the 5p cut ends and the RPI rise is added at the same time. That is a bigger single step than either change alone.

EV drivers pay more at public chargers from November

HMRC says electricity from publicly accessible chargers is standard rated, so 20% VAT applies from 1 November 2026. Charging at home is domestic electricity, which is 0% until 30 June 2027.

Pay-per-mile for electric cars

From 1 April 2028 Electric Vehicle Excise Duty will be 3p a mile for battery electric cars and 1.5p a mile for plug-in hybrids. Drivers will give a mileage reading and an estimate when they renew.

Food tariffs are small change

The Treasury expects the new food tariff suspensions to cut consumer costs by £120 million to £185 million a year across the whole UK, which is a small amount per household.

Illustrative example

A driver doing 8,000 miles a year in an electric car

Rhys drives a battery electric car about 8,000 miles a year and charges at home.

  1. In 2027 to 2028 his car pays the standard VED rate of £210, plus the £440 expensive car supplement if its list price was over £50,000 and it is in years two to six.
  2. From 1 April 2028, Electric Vehicle Excise Duty at 3p a mile would be about £240 a year on 8,000 miles.
  3. Home charging stays at 0% VAT until 30 June 2027.

About £240 a year extra from April 2028 on top of VED

Illustrative calc. Rhys is made up. 8,000 × 3p = £240. The rate rises with CPI from 2029 to 2030.

Common misreadings

You might hear: Fuel duty is going up in January 2027.

Actually: That plan has been cancelled. The 5p cut now lasts until 30 June 2027.

You might hear: The £2 bus fare cap covers the whole UK.

Actually: The Treasury describes it as a cap on single fares in England outside London for one year from 1 January 2027.

You might hear: Pay-per-mile starts next year.

Actually: Electric Vehicle Excise Duty starts on 1 April 2028.

Where the UK nations differ

UK-wide
Fuel duty, VED, Electric Vehicle Excise Duty, alcohol and tobacco duty and food tariffs apply across the UK.
England
The £2 single bus fare cap applies outside London.
Northern Ireland and rural areas
The suspension of tariffs on kerosene heating oil until December 2028 is aimed at homes that heat with oil, including many in Northern Ireland.

What you could do

  1. drive a petrol or diesel car

    Expect a rise at the pump around 1 July 2027 when fuel duty goes up.

    By 2027-07-01

  2. charge an electric car on the street

    Compare public charger prices after 1 November 2026, when 20% VAT applies.

  3. are thinking of buying an electric car

    Include the 3p a mile Electric Vehicle Excise Duty from April 2028 in your running costs.

Timeline

  1. 1 November 2026

    VAT on public EV charging

    Electricity from publicly accessible chargers standard rated at 20%.

  2. 1 January 2027

    £2 bus fare cap

    Single fares in England outside London capped for one year.

  3. 1 February 2027

    Alcohol duty rises

    Duty rates rise with RPI inflation.

  4. 1 April 2027

    Car tax rises

    VED standard rate £210 for 2027 to 2028. Soft Drinks Industry Levy rises.

  5. 1 July 2027

    Fuel duty rises

    Petrol and diesel duty goes from 52.95p to 60.59p a litre.

  6. 1 April 2028

    Electric Vehicle Excise Duty

    3p a mile for battery electric cars, 1.5p for plug-in hybrids.

  7. 31 December 2028

    Food tariff suspensions end

    Over 100 food products, plus kerosene, until December 2028.

The detail

The rules

  • Fuel duty: 5p cut extended from 1 January 2027 to 30 June 2027; from 1 July 2027 rates return to pre-March 2022 levels uprated by RPI (OOTLAR 2.18). Unleaded and diesel 0.5295 to 0.6059 £ per litre (Annex A).
  • Red diesel 3.7p cut extended to 30 June 2027.
  • VED for cars registered from 1 April 2017: standard rate £200 (2026 to 2027), £210 (2027 to 2028); expensive car supplement £440 a year in years two to six (list price over £40,000, or £50,000 for zero emission cars) (Annex A).
  • Electric Vehicle Excise Duty from 1 April 2028: 3p a mile (battery electric and hydrogen), 1.5p (plug-in hybrid), uprated by CPI from 2029 to 2030 (OOTLAR 1.76).
  • VAT: public EV charging electricity standard rated from 1 November 2026 (OOTLAR 1.82).
  • Bus fares: single fares capped at £2 in England outside London for one year from 1 January 2027 (Impact on households, 1.4).
  • Alcohol duty rises with RPI from 1 February 2027; for example beer 3.5% to under 8.5% ABV £22.58 to £23.61 per litre of pure alcohol (Annex A, OOTLAR 1.69).
  • Soft Drinks Industry Levy £2.25 and £3.01 per 10 litres from 1 April 2027 (OOTLAR 1.67).
  • Tobacco duty rose from 1 October 2026: cigarettes 16.5% of retail price plus £394.09 per 1,000; vaping products duty £2.20 per 10ml (Annex A).
  • Tariffs suspended on over 100 food products and kerosene until December 2028 (Budget 2026, 4.5).

References

  • Budget 2026, 4.4: Fuel duty, red diesel, EV public charging.
  • Budget 2026, 4.5: Food and kerosene tariff suspensions.
  • OOTLAR 1.76, 1.78, 1.82, 2.18: eVED, VED uprating, EV charging VAT, fuel duty.

Documents

Words explained

Fuel duty
A tax charged on every litre of petrol and diesel. VAT is added on top.
Vehicle Excise Duty (VED)
Car tax, paid yearly or monthly to keep a vehicle on the road.
RPI
The Retail Prices Index, a measure of inflation used to raise some duties.
Tariff
A tax on goods imported into the UK.

In short

Fuel duty stays frozen until the end of June 2027, then rises by about 7.6p a litre. Car tax rises a little in April 2027, and electric cars face a pay-per-mile tax from April 2028. In England outside London, single bus fares are capped at £2 during 2027.

Related dates

  • 1 Nov 20% VAT on public EV chargingChange · in 4 days
  • 1 Jan £2 single bus fare cap startsChange · in 65 days
  • 1 Feb Alcohol duty rises with RPIChange · in 96 days
  • 1 Apr Car tax (VED) rises for 2027 to 2028Change · in 155 days
  • 1 Jul Fuel duty rises to 60.59p a litreChange · in 246 days
  • 1 Apr Pay-per-mile tax on electric cars startsChange · in 521 days
See the money calendar

Sources

  1. Budget 2026 (HTML), HM Treasury (2026-10-28)
  2. Budget 2026: Overview of tax legislation and rates (OOTLAR), HMRC (2026-10-28)
  3. OOTLAR Annex A: rates and allowances, HMRC (2026-10-28)
  4. Impact on households: distributional analysis to accompany Budget 2026, HM Treasury (2026-10-28)
  5. Electric Vehicle Excise Duty (eVED), HMRC
  6. Vehicle tax rate tables, GOV.UK

This is guidance, not regulated financial advice. Check figures against the linked official source before you act. Written with AI assistance and checked against primary sources. How Kitty works. For free, impartial help, try MoneyHelper or Citizens Advice.