Question’s in the title……
I’m no economist but I’m sure most of the cost of fuel is Fuel Duty (tax)….. so even though capping the price of fuel would mean governments making less money off fuel-duty, wouldn’t they make this back in VAT on other goods as consumer spending increases? (Because consumers have more money in their pocket?)
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The goverment could cap the cost of petrol but it is a horrible, horrible idea. Prices are a signal for scarcity, and blocking the signal will only exacerbate the problem in the long run. It is a far better idea for the government to support other solutions to reduce the need for petrol consumption.
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