Osborne siezes the initiative on fuel tax

The Conservative position on fuel tax - that taxes should be lowered as fuel costs increase - makes absolute sense. High fuel taxes hurt business and the consumer and the state need to share the burden in order to reduce the economic effects.

Gordon Brown's position is rapidly coming apart. All of the focus thus far has been on the proposed 2p increase in October. But the massive increase in tax revenue from current high prices is being noticed. What I think is interesting is that Gordon Brown happily tours the world encouraging oil producers to increase output. If he genuinely believes this should happen, then it means he is prepared for the resultant reduction in tax-take, in which case he can afford to reduce fuel taxes now.

By trying to talk prices down, he is helping to make the case for Conservative policy.

It's not just about cancelling a future fuel tax rise

It seems that everyone is urging the Chancellor to cancel the forthcoming 2p rise in fuel duty. Of course yet another embarassing U-turn would be for the benefit of the country, but it surely must go further than that. The current price of petrol includes a massive 70% tax and the rises we have seen have also seen the Government coffers enriched considerably.

The Chancellor must cut fuel duty to a rate below it's current level to compensate for the extra VAT we are paying. That would be fairness. It might also do a little much-needed good for the economy.