Britain overtook the Netherlands as the most expensive place in Europe to buy petrol after excise duties were increased in the budget.

Mr Brown said that duties on unleaded petrol would rise by 6.5 per cent or 3.8p a litre while standard diesel would go up by 6.1p a litre. Leaded fuel will rise by 4.2p a litre.

Taxation - including excise duty and value added tax - now accounts for over 86 per cent of the retail price of unleaded gasoline.