Government targets food and travel costs with tariff cuts and mileage rise, aiming to ease pressure on households as global instability continues to drive living expenses higher, reports Asian Lite News Desk
The HM Treasury has unveiled a sweeping package of cost-of-living measures aimed at easing pressure on households, including proposed tariff cuts on more than 100 everyday goods and the first increase in mileage rates for workers in 15 years.
The measures, announced as part of a broader economic response to rising global instability and inflationary pressures, are designed to lower the cost of essential food items while putting more money back into the pockets of millions of workers who rely on their vehicles for their jobs.
At the centre of the package is a new consultation on suspending tariffs on 125 commonly used products, ranging from fresh fruit and vegetables to cooking oils, baked goods and pantry staples. Items under consideration include garlic, avocados, mangoes, nectarines, olive oil, vegetable oil and baked beans—products that feature regularly in household shopping baskets.
Ministers say the move could help reduce prices at the checkout if businesses pass on the savings to consumers. The consultation also seeks input from industry stakeholders on the potential impact of further tariff suspensions, including whether removing duties on certain fertilisers could help farmers cope with rising input costs linked to ongoing conflict in the Middle East.
Chancellor of the Exchequer Rachel Reeves framed the measures as part of a wider effort to shield households and businesses from global economic shocks. She said that while geopolitical tensions abroad were beyond the UK’s control, the government’s priority was to keep domestic costs down.
Alongside the tariff proposals, the Treasury has confirmed a significant increase in tax-free mileage rates, marking the first uprating since 2011. The rate for the first 10,000 business miles will rise from 45p to 55p per mile for the current tax year, backdated to April 2026. The change represents a 10p increase per mile and is expected to benefit around three million people, including employees and the self-employed.
Officials estimate that a worker travelling 6,000 business miles annually could save more than £120 as a result of the higher rate. The increase is being described as the largest ever uplift in mileage allowances and is aimed at supporting a wide range of workers—from carers and tradespeople to public sector staff—who depend on their own vehicles to carry out their duties.
The mileage reform comes in addition to continued relief at the pump. The Chancellor has extended the fuel duty freeze for a third time, a move the Treasury says has saved motorists around £120 since last year. Additional targeted support has also been introduced for sectors heavily reliant on fuel, including agriculture and logistics.
For farmers and others using red diesel and rebated biodiesel, duty rates have been cut by more than a third, reaching their lowest level in over 20 years. Meanwhile, hauliers will benefit from a one-year road tax holiday starting from July, aimed at easing operational costs across supply chains.
Transport Secretary Heidi Alexander said the measures reflected a commitment to supporting workers who have long faced rising travel costs without adequate compensation. She highlighted the importance of those who use their vehicles for work, describing them as essential to keeping public services and local economies functioning.
The announcement has also been welcomed by trade unions. Andrea Egan, General Secretary of UNISON, said the increase in mileage rates would provide immediate financial relief to frontline workers, many of whom have been absorbing rising costs for years due to frozen allowances.
The measures form part of a wider package branded “Great British Summer Savings”, which includes temporary VAT cuts on children’s meals in restaurants and admissions to leisure attractions such as theatres and theme parks. Free bus travel for children aged five to 15 in England has also been introduced to help families manage seasonal expenses.
These steps build on earlier interventions announced in the Budget, including reductions in household energy bills, freezes on prescription charges and rail fares, and increases to the national minimum and living wages.
Treasury officials argue that the combined effect of these policies will help strengthen household finances while supporting economic activity during a period of uncertainty. However, the success of the tariff reductions in lowering food prices will depend largely on whether savings are passed through supply chains to consumers.
With consultations now underway, businesses and stakeholders have been invited to provide feedback on the proposals before final decisions are made. Ministers say the goal is to strike a balance between supporting domestic industries and easing cost pressures for households.
