Chancellor George Osborne
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Osborne: Oil duty will 'help with cost of living'

Chancellor George Osborne has said the new windfall tax on North Sea oil producers will help families with the cost of living, despite claims by Labour that oil firms will recoup this by raising pump prices.

The measure, announced in Wednesday's Budget, raises the supplementary charge levied on oil and gas production from 20% to 32%, which the chancellor believes will raise £2bn.

The chancellor also cut fuel duty by 1p per litre, cancelled the introduction of a fuel duty escalator and delayed other planned duty rises.

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