What a rip-off!!

Just when I think the fuel price will fall following the 2.5% drop in VAT charges, the government raise the duty on fuel to quosh my excitement. Well, not strictly excitement but you catch my drift. Asda have announced that they WILL be dropping their prices on all their forecourts by 1p per litre, so good for them. When you take into consideration that crude oil is at its' lowest price since March 2007 (at which time diesel was costing me about 90p per litre, it's now on average 15p more than that) I have this feeling that I and every one else is being ripped off. Especially when my diesel should have dropped 3p per litre from Dec.1st just because of the lesser VAT. That's my profits eaten into again, I don't know about you but it really grinds my gears!!!!!!!!

Hi Andy,

I take your point entirely about the cost of diesel. I remember a good few years ago, when diesel was cheaper than petrol, and in the boating world, everyone sold their petrol boats to buy diesel. The same thing happened with cars!

Hi Ray--yep---once the government realised how many diesel cars were on the road, tax rates changed so they wouldn't miss out----and negate any running cost advantage over petrol engines, or icreased cost of buying a diesel car in the first place. 60,000 miles to break even now over petrol cars ?

The snag of lowering VAT on petrol then putting it back up with an increase in petrol duty, means increased costs for business users as they can't claim the VAT back as much as they did---so they've actually have had a price increase from their perspective, and may well appear in the shops as a price rise to cover for this effect of what they've actually done.

I think this is how that translates into oil companies' accounts here, Andy, considering all your valid comments--http://news.bbc.co.uk/2/hi/business/7694508.stm

 A  2.5% reduction in VAT equates to a 2.1% drop in prices; to illustrate:

Something that formerly cost £100 + VAT @ 17.5% = £117.50.  Reduce the VAT to 15% and that now becomes £115 total. The price reduction in the shops has become 2.1%, for those who assumed it would drop 2.5%.

I know about VAT as I'm VAT registered. I have to claim my VAT back....and charge VAT now at 15%. So now my fuel, which is my biggest cost, is exactly the same per litre as it was when VAT was at 17.5%, which means in reality it's more expensive for me now than it was with the old VAT rate, because I can't claim as much back.

That's why I titled the thread ''What a rip off''. I can't see fuel prices ever coming down again now, even with oil at rock bottom prices.

If you guys want to know what an real "rip-off" is, it's got to be the electric company..Kenny Lay was just an prime example of it...for 30 years we have owned our house, when we bought it, the downstairs was unfinished and we did it ourselves, re-buiding the arched fireplace to slip in an wood stove to heat with, ever lived in the country and had the elecricity go off from an storm, we have many times, we live in an "all electric" house. The fuel companies went to war to see woodstoves all but wiped out in ways, you had ot have an "permit" for installing them, they managed to get the price of wood tripled...anything to make the price of woodstoves up with the utiltity companies. The night of 911, being pulled off under our feet, while we all watched what was going on TV, was an quiet 40 per cent increase of electric rates. But you know, then they say change your bulbs,insulate,  use cost efficient methods, done that, right down to using just the TV set at night for lights..in 30 years of costing us more for electric rate saving..... we have never seen any come to pass. So I consider it an "rip-off" and an costly one, for the average homeowner can't deduct it as an expense, though it is an necesseary one, and as my mother would often say to me, don't put your money into things you can't get back and sell down the line,..it's bad business. Yes, every month I look at what seems to me "wasted" money going out the door. I figure here soon they should have us paying top dollar for "nothing".....as we grope in shutting everything off...so we wont' have higher expenses.