Budget: Bus and private jet users clobbered equally

As the dust settles on the Chancellor’s first budget, we’re looking at some strangely mixed messages on the transport front.

In summary, it’s bad news if you use a private jet or a bus to get around, but excellent news – again – for the motorist. 

The fact that the bus fare cap is to increase by 50% from £2 to £3 was reveled in advanced but it came as some surprise today to hear that private jet users will be similarly penalised, with a 50% hike in air passenger duty.

From the budget:

For 2026-27, the government will increase rates of Air Passenger Duty (APD). This equates to £1 more for those taking domestic flights in economy class, £2 more for those flying to short-haul destinations in economy class, £12 for long-haul destinations, and relatively more for premium economy and business class passengers.

The higher rate, which currently applies to larger private jets, will rise by a further 50% in 2026-27.

From 2027-28 onwards, all rates will be uprated by forecast RPI and rounded to the nearest penny. The government is also consulting on extending the scope of the APD higher rate to capture all passengers travelling in private jets already within the APD regime.

This was followed by some excellent news for the motorist:

The government will freeze fuel duty rates for 2025-26, a tax cut worth £3 billion over 2025-26 which represents a £59 saving for the average car driver. The temporary 5p cut in fuel duty rates will be extended by 12 months and will expire on 22 March 2026. The planned inflation increase for 2025- 26 will also not take place.

Naturally, this has caused some kick-back amongst those hoping for a logical approach towards the government meeting their own Net Zero ambitions, for which a priority must be to get people out of their cars. Fuel duty freezes have increased UK total greenhouse gas emissions by 7% since 2010.

One of the first to respond was George Roffey, CSO at Centrus: ‘Despite today’s budget including big tax rises overall, the chancellor has again chosen to freeze fuel duty at 5p. Today, the chancellor stated that they are the party of ‘long-term’ outlook, however, freezing the fuel duty today feels like a short-term outlook on a global problem – all we’re doing is kicking the can down the road. Climate change is one of the biggest – if not the biggest – challenge we face today and in the future, and by the government today freezing the price at the pumps, it shows they do not prioritise long-term sustainability and the phase out of petrol cars.’

James O’Malley, of the Odd and Ends of History blog said on X: ‘The year is 2743, oil has long run out, but Parliament must perform the ritual fuel duty freeze ceremony, as per tradition.’

Top graphic: Possible

Lower graphic: New Economics Foundation