Cancellation of fuel duty increase is good for Isles

Orkney and Shetland MP Alistair Carmichael has welcomed news that the UK government has scrapped the 3p per litre fuel duty hike that was due to come into force in January.

Speaking in the House of Commons, the Chancellor of the Exchequer confirmed that the rise would be abandoned during his Autumn Statement. Other measures included in the statement mean that the spending power of the Scottish Government will increase by £331m over this Spending Period.

The Chancellor also told the House that the personal income tax allowance will increase to £9440 next year. This will give 2.2 million people in Scotland a tax cut and take a further 21,000 low paid Scots out of income tax entirely from next April

Commenting, Mr Carmichael said:

"Ministers are well aware of the difficulty that the high price of fuel has continued to cause for families around the country. In places like the Northern Isles where alternatives to the car are not always available, increases in fuel costs puts a real squeeze on household income and news that the duty rise has been scrapped is welcome. I had received emails from hundreds of people across the Isles on this issue and am pleased that the Chancellor and Chief Secretary to the Treasury have acted to help local motorists.

"We should be under no illusions as to the size of the economic challenge that we still face. As the Chancellor made clear in his statement, there are no miracle cures here but there is much in this package that can be welcomed. The additional money for capital spending will see Scotland get hundreds of millions of pounds to invest in infrastructure and help create jobs. The Scottish Government asked for more capital investment and they have got it. The First Minister needs to stop grandstanding and focus on ensuring that this money gets to where it is needed.

"At a time when everyone is being asked to tighten their belts, it is also wrong that large companies should be able to avoid paying their fair share in tax. Ministers have made clear that tackling tax avoidance is a real priority. Multinational firms cannot expect to benefit from what the UK has to offer – whether we are talking transport links or our educated workforce – unless they do their part and pay their taxes.

"For me, the key test of this Autumn Statement was whether we could make the tough spending decisions in a way that was fair. Ministers are targeting tax avoiders. They are cutting income tax for people on low and middle earnings. They are protecting benefits payments for the disabled and scrapping a fuel duty rise that would see families in the Isles pay 3p more per litre for their fuel from January. Older people will see a cash increase in their state pension of £2.70 per week in 2013. The government has not ducked the difficult choices and has delivered for some of the most vulnerable people in our society."