Millions Gain from Lower Travel Costs and Cheaper Food

Lower travel costs are on the horizon for working individuals, as the Government reveals plans for further cost-of-living assistance. This includes targeted tariff cuts on over 100 essential items and an increase in mileage rates for the first time in 15 years. The consultation seeks input from businesses and stakeholders regarding the potential implications of a second support package. It covers a wide array of everyday essentials, including fresh produce, oils, baked goods, chocolate, sauces, and soft drinks. The compiled list of 125 items features garlic, avocados, mangoes, nectarines, vegetable oil, olive oil, and baked beans. This initiative expands on the tariff suspension announced in April. In addition, the government is evaluating whether suspending tariffs on specific fertilizers could assist farmers struggling with rising fertilizer prices due to the ongoing conflict in the Middle East. Chancellor of the Exchequer Rachel Reeves stated, "The war in Iran isn’t our war, but we must respond to it, prioritizing the need to keep prices down for households and businesses. That's why we're freezing fuel duty, raising the mileage rate for the first time in 15 years, and temporarily cutting VAT this summer to help mitigate leisure costs." This change means that carers, plumbers, builders, and countless other workers using personal vehicles for their jobs will see reduced travel costs, thanks to the Chancellor's recent update on mileage rates. In the largest-ever increase, the tax-free mileage rate has been raised by 10p per mile for this tax year, retroactive to April 2026. This adjustment aims to alleviate financial pressure on diligent Britons. The new rate escalates from 45p for the first 10,000 miles to 55p per mile, saving about £120 for workers traveling 6,000 business miles. Approximately two million employees and one million self-employed individuals stand to benefit from this adjustment. Moreover, drivers will enjoy additional savings from the extended fuel duty freeze until year-end. This marks the third instance in which Rachel Reeves has frozen fuel duty to support motorists, saving them £120 since the previous year. Acknowledging the challenges faced by farmers and hauliers regarding high fuel costs and their vital roles in UK supply chains, the government has announced more relief measures. For farmers and those utilizing red diesel and rebated biodiesel, the tax rate for these fuels has been decreased by over a third, marking the lowest rates in over 20 years. Additionally, hauliers will benefit from a road tax holiday, effective from July 1st. Transport Secretary Heidi Alexander emphasized, "We are a government dedicated to supporting drivers. It's crucial to act when hardworking individuals are left economically strained. Those relying on their vehicles for work are the foundation of our nation—carers, tradespeople, and public sector workers. They've long faced rising costs without adequate support. We are focused on easing daily financial burdens and putting real money back in their pockets." Andrea Egan, General Secretary of Unison, commented, "This simple measure will provide immediate relief to numerous frontline workers in public services, particularly at a time when living expenses are escalating. Workers who rely on their own vehicles for their jobs have been financially burdened for too long. UNISON has vigorously advocated for this necessary change, and it's encouraging that the Chancellor has responded to workers' concerns. There's more to accomplish to ensure everyone is supported, and we will continue to campaign for further improvements." This announcement follows a broader support package announced by the Chancellor last week, labeled ‘Great British Summer Savings.’ It includes free bus travel for children aged 5–15 in England, a VAT reduction on children's restaurant meals, and a VAT cut for all admissions to theaters, theme parks, and other attractions. Such measures aim to assist families in enjoying weekend outings and staycations amidst the cost-of-living challenges spurred by the Middle Eastern conflict, while simultaneously aiding businesses reliant on summer foot traffic. The package also reduces household energy bills by an average of £150, freezes prescription charges and rail fares, and increases the national minimum and living wages by hundreds of pounds—ongoing actions aimed at supporting families every month. For additional insights on government initiatives regarding cost-of-living support, visit [gov.uk](https://www.gov.uk/government/news/millions-to-benefit-from-lower-travel-and-food-costs). To learn more about how to manage your finances amidst these changes, check out [www.globemigrant.com/savings](http://www.globemigrant.com/savings) and [www.globemigrant.com/financial-planning](http://www.globemigrant.com/financial-planning).

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