Rural Fuel Duty Relief

Ian Roome Excerpts

Wednesday 7th January 2026 Westminster Hall

[Ian Roome (North Devon) (LD)]

I beg to move,

That this House has considered the Rural Fuel Duty Relief scheme.

It is a pleasure to serve under your chairship, Ms Furniss. I am pleased to have the opportunity to introduce this debate, especially in the new year at a time when many people across the country will be watching the pennies closely.

As hon. Members representing rural constituencies will be aware, the rural fuel duty relief scheme was announced more than 15 years ago and supports people living in some of the most remote rural communities in Britain. Under the scheme, a 5p per litre tax relief on unleaded petrol or diesel is granted to specific filling stations in a small number of rural postcode sectors. That relief must be passed on to rural motorists, helping many with their commute, school run or weekly shopping. The scheme benefits around 125,000 local residents and many visitors across the United Kingdom.

[David Chadwick (Brecon, Radnor and Cwm Tawe) (LD)]

Not a single part of Wales benefits from the rural fuel duty relief scheme, while rural areas in England and Scotland do, simply because of how the previous Conservative Government designed it. Does my hon. Friend agree that that unfair anomaly should be corrected and that the scheme should be extended to places such as Powys?

[Ian Roome]

I agree with my hon. Friend that more people could benefit from the scheme. I am sure the Minister will take note of that in his response. As I said, the scheme benefits around 125,000 local residents and many visitors across the UK, including the remote parts of the Scottish islands, Cumbria, Northumberland, North Yorkshire, the Isles of Scilly and Exmoor. That includes residents in my constituency of North Devon, who live in areas around Lynton and Lynmouth, Parracombe and Brendon, including many living in upland areas within the boundaries of Exmoor national park.

The tax relief is targeted at highly rural areas. A brief glance at a map shows that these are some of the most isolated and indispensable filling stations across the country. If someone forgets to fill up at Barbrook filling station in my constituency, while heading out over Exmoor, it is nearly 20 miles to the next fuel stop at Wheddon Cross or Minehead. When the rural fuel duty relief scheme was introduced under the coalition, and approval under EU state aid rules was granted in 2012, the relief was set by the Government at 5p per litre. That 5p per litre remains unchanged today in 2026, despite more than 30% of its purchasing power being eroded over that time because of inflation. An update to the scheme is now long overdue.

According to research by the Rural Services Network in 2023, transport difficulties in highly rural areas force households into paying high costs for motoring, which contribute significantly to rural poverty. A car is needed for daily life and for someone who earns a modest wage that is expensive. The research estimates that for every 10% decrease in public transport speed relative to motoring in any area, the average household pays more than £400 more for transport each year.

[Martin Wrigley (Newton Abbot) (LD)]

Does my hon. Friend agree that the relief scheme could be complemented by a pumpwatch scheme, whereby the petrol price comparison platform has rapid publication of all fuel costs for forecourt prices? That is approved by the Competition and Markets Authority and the RAC estimates it could take up to 3p off a litre, in addition to the specific rural relief scheme that he mentions.

[Ian Roome]

I know there are various apps that do that. There should be more awareness of them among members of the public.

Fuel duty is only part of the expense of running a vehicle, but many who fill up in areas impacted by the scheme have simply no transport alternatives. In my constituency, the households that benefit are 20 miles from their nearest train station, and bus passengers receive only the most limited bus service. Every January, those passengers are also hit by annual price increases from bus companies, which put extra strain on the cost of living.

The scheme is not particularly expensive. In the published list of non-structural tax reliefs, the Treasury estimates that the rural fuel duty relief scheme costs only around £5 million per year, and its uncertainty rating is considered low, yet during the past decade the scheme has been a roaring success. Barbrook filling station in my constituency tells me that this tax relief has made a massive difference to the viability of its business, keeping open an essential local service for many rural residents, local farmers and tourists.

[Mr Angus MacDonald (Inverness, Skye and West Ross-shire) (LD)]

In my constituency, the price per litre of unleaded is 160p. When I was in Northern Ireland over Christmas, places were selling at 125p. We have a 35% premium on the cost of living where I live, and fuel is major part of it. In my constituency, there is a big question as to whether the 5p is actually getting to the customer or being kept, and I hope that the Minister will address that.

[Ian Roome]

Fifteen years ago, Barbrook in my constituency was officially one of the most expensive places to fill up in England, but thanks to the scheme it has stayed competitive on price, as a small business that employs four people all year round, in an area where employment can be highly seasonal. During the summer, Barbrook’s fuel deliveries increase to several tankers per week because of extra demand, driven mainly by tourists visiting Exmoor national park and the famous North Devon coast on holiday.

I am also told that Barbrook filling station rescues many of those visitors—people who do not understand the extra challenge of driving long distances on small rural roads, or who do not plan for the extra fuel consumption of their journey. Many rural communities already suffer from very sparse public services, and fuel for transport is an important part of anyone reaching essential healthcare, such as their local hospital or dentist. As I know from speaking to chemotherapy patients at North Devon district hospital, where I worked before I was elected to this House, access itself is half the battle.

My Liberal Democrat colleagues and I—including my right hon. Friend the Member for Orkney and Shetland (Mr Carmichael), my hon. Friend the Member for Westmorland and Lonsdale (Tim Farron) and others—champion the real needs of rural communities, as do colleagues who are here today. We have argued for the rural fuel duty relief scheme’s importance and for extending it to many more rural parts of the country.

However, support for the scheme should really be cross-party. By my count, at least 11 directly impacted rural constituencies are represented by MPs from Labour, the Conservatives, the Liberal Democrats and the Scottish National party. There are also many neighbouring rural constituencies with villages that rely on a filling station just over the border that is supported by this tax relief.

Since 2011, it has become a feature of Budgets under successive Governments that fuel duty will be frozen. That has benefited motorists across Britain, yet in March 2022, a further 5p cut in fuel duty was introduced and then held in place, even as the value of the rural fuel duty relief scheme continued falling in real terms. That means that in recent years we have gone backwards: many of our most rural taxpayers have effectively increased their support to motorists in some of the best connected parts of the country. Motorists in urban communities not only benefit from having more public transport alternatives but often have numerous filling stations to choose from—all competing on price, to the benefit of local people. By contrast, many of my constituents count themselves lucky to have even one filling station in their area.

The Government have stated that economic growth across the country is their top priority for this Parliament. In parts of the country that are distant from major infrastructure projects, such schemes are an important measure, supporting small businesses, farming and tourism, helping young people to access opportunities, and helping patients to access essential healthcare. At a time when the Government are increasingly under fire for their policies towards rural and farming communities, updating the rural fuel duty relief scheme would be one way for them to demonstrate their concern about those families who live in rural areas and the problems they face in their daily lives.

[Brendan O’Hara (Argyll, Bute and South Lochaber) (SNP)]

I sincerely thank the hon. Member for securing this debate. My constituency of Argyll, Bute and South Lochaber is 10,500 sq km in size, with 23 inhabited islands; it is absolutely vast. Life is difficult for people living in rural areas and anything that we can do to make life a bit easier for them should be considered. Does he agree that the scheme should not only be further extended to cover more people in rural areas, in order to stop the scourge of depopulation, but that the value of the scheme, which has declined by 35% since 2012, should be restored by this Government as soon as possible?

[Ian Roome]

I agree with the hon. Gentleman and thank him for that input.

When so many people are struggling with the cost of living, schemes like this one are a concrete example of how tax relief can have an out-sized impact. A relief of 5p per litre would be welcome anywhere, but it is particularly valuable to those constituents of mine who have no choice but to drive, in an area where gross median wages are £84 a week less than the national average.

Just last week, the Prime Minister stated that the Government would spend this new year proving to people that they can support them with energy costs, warm homes and the cost of living. My constituents see their fuel costs displayed digitally on a sign by the side of the road every single day. The rural fuel duty relief scheme makes a material difference to many of my constituents and to tens of thousands of people in rural communities across the United Kingdom.

I will close by asking the Minister some questions. Does the Treasury recognise that time and inflation have effectively bled the funding of the scheme by around 30% since it was introduced? Will the Government consider updating the value of the scheme in the coming year to rectify that gap, at least in part? Just a few weeks ago, it was highlighted in the Treasury Committee that the Treasury lacks a suitable review process for existing tax reliefs. What more can be done to ensure that in the future small but important schemes such as this one, which are a lifeline in rural areas like mine, do not get left behind again?

--- Later in debate ---

[Ian Roome]

I will be brief, Ms Furniss, because I know we are almost out of time.

I thank the Minister for his response and I appreciate his taking the time to engage with me and others on this issue. While we do not expect the Government to commit themselves ahead of a future Budget, I know that my constituents value the support that the scheme provides to very rural areas, and it would be good to see progress towards restoring the funding to its former level.

I also thank all Members for their contributions—what a debate! We have covered from the top of Scotland down to the Isles of Scilly and Land’s End, which is absolutely fantastic. We have heard representations from Wales, Northern Ireland and England, obviously, so what a great and inclusive debate it has been, from across the whole of the United Kingdom and all our rural constituencies.

Fuel is very much part of my constituents’ daily lives. It is an unavoidable cost; personal transport is much needed, because there is no regular public transport in any of the EX35 area, and people cannot walk to bus stops because of the terrain and the rurality.

Many accusations have been thrown at the Government over the past year to claim that they do not care about rural areas. When the next fiscal event arrives later this year, updating the scheme for 2026 will be a chance to counter those claims, at very little cost compared with other schemes. I therefore hope that the Government will take that opportunity, on behalf of communities that are often forgotten, to deliver good news at the pumps for rural people.

Question put and agreed to.

Resolved,

That this House has considered the Rural Fuel Duty Relief scheme.

Agricultural Property Relief and Business Property Relief

Ian Roome Excerpts

Monday 5th January 2026 Commons Chamber

[Dan Tomlinson]

I recognise that many estates that would have been affected by the lower threshold, rather than having to pay additional inheritance tax, will now not be paying any inheritance tax at all. We have moved hundreds of estates out of having to pay additional inheritance tax. We have also reduced the tax liabilities for those larger estates too, because we have listened.

[Ian Roome (North Devon) (LD)]

Many of my rural constituents are relieved that the Government have partly seen sense on this issue. Given the track record of U-turns from this Government, when I meet with a group of local farmers next week, what reassurance can I give them that the Government will not change course on this policy again in the near future?

[Dan Tomlinson]

The Finance (No. 2) Bill will be making its way through the House in the coming weeks, and once the Bill is law that change will come forward. If the hon. Gentleman meets his farmers on 7 April this year, the change will already be in place.