Record fuel prices for farmers and motorists are putting pressure on the Chancellor of the Exchequer to act as he prepares his spring statement for March 23.

Fuel duty has been frozen for many years, with full duty fuel taxed at 57.95p per litre, and 11.14p per litre for the red diesel used in agriculture, fisheries or forestry.

Big announcements should not be expected in the spring budget, which is usually reserved for small economic tweaks compared to bigger changes made in the autumn budget. But with the spiralling cost of living crisis, NFU Mutual claimed that the government can take immediate steps to ease the challenge of escalating prices.

The Mutual also believes that there could be a move to reduce the levy on domestic heating oil which is taxed at 10.7p per litre. Rural houses heated by oil have seen their bills double in the last year.

Read more: Ploughing matches and farm shows can keep running on red diesel!

Another potential move from Mr Sunak could be to delay the 1.25% hike in National Insurance which was announced last autumn. NFU Mutual said there is now growing pressure on him to delay an increase which will leave the vast majority of workers with less money in their pocket at a time of skyrocketing energy bills.

NFU Mutual said: “Delaying the rise by at least 12 months would also be welcomed by business owners, who face the prospect of paying more National Insurance at a time of rising costs in other areas like fuel and materials.

“If the hike does go ahead, employees and businesses can reduce the impact by paying more into their pensions using salary sacrifice."

The Chancellor’s has raised money in the past through fiscal drag, where he freezes a number of key tax allowances until 2026. Mr Sunak could reverse his decision to freeze the Personal Income Tax Allowance, which sets the amount of money people get paid before paying tax. If this moved by the Bank of England’s inflation rate of 5.5%, the allowance would jump from £12,570 to £13,261.