The Chancellor George Osborne has dropped heavy hints that he may announce a deferral of the 3p increase in fuel duty scheduled for January in his Autumn Statement.
The news follows calls from the British Retail Consortium in a letter to the Chancellor to scrap the rise altogether in order to ease the cost of living on consumers, who are already feeling the pinch, and retailers that will be hit across their logistics and delivery networks.
Last night Labour demanded the duty rise be deferred until at least next April, which is thought would cost the Exchequer £350m.
But the Labour motion was defeated by 282 votes to 234 after Conservative MPs who support the fuel duty deferral were urged to wait for an announcement from the Chancellor when he reveals his Autumn Statement on December 5, the Financial Times reported.
Robert Halfon, a leading campaigner for lower fuel duty on the Tory benches, said he believed the Treasury is listening to the concerns of Conservative MPs and their constituents.
He said: “I have had discussions with various people and it is my view that the Government is in strong listening mode.”
Downing Street said the Government always tried to “listen to the concerns of motorists” and referred to previous deferred planned fuel duty increases by Osborne.