The 5p cut in fuel duty to be scrapped in the upcoming Autumn Budget, according to the RAC.
The motoring organisation says that motorists in the UK are 'not gaining any benefit' and retailers have failed to pass on lower petrol and diesel prices to drivers.
Prime Minister Keir Starmer recently refused to rule out a rise in fuel duty and warned that the Autumn Budget will be 'painful'.
The RAC suggested that average petrol prices should be reduced from 142p per litre to 136p per litre and diesel prices from 147p per litre to 139p per litre.
Simon Williams, Head of Policy at the RAC, said:
'We'd normally be against any increase in duty. But we've long been saying drivers haven't been benefitting from the current discount due to much higher-than-average retailer margins.
'As more and more EVs come on to the roads the government will need to tax drivers differently. We think replacing fuel duty with a pay-per-mile system as soon as possible is the way forward as then the only tax levied on fuel would be VAT. This would give retailers nowhere to hide.'