Compute fuel duty from calibrated litres

Author: MaxGhenis

changelog.d/fuel-duty-litre-rate.md

@@ -0,0 +1 @@
+- Compute fuel duty directly as calibrated petrol and diesel litres multiplied by the statutory duty rate.

policyengine_uk/tests/test_fuel_duty_litres.py

@@ -0,0 +1,38 @@
+import pytest
+
+from policyengine_uk import Microsimulation
+from policyengine_uk.system import system
+
+
+def test_fuel_duty_is_litres_times_statutory_rate():
+    year = 2025
+    situation = {
+        "people": {
+            "adult": {
+                "age": {year: 35},
+            },
+        },
+        "benunits": {
+            "benunit": {
+                "members": ["adult"],
+            },
+        },
+        "households": {
+            "household": {
+                "members": ["adult"],
+                "region": {year: "LONDON"},
+                "petrol_spending": {year: 2_000.0},
+                "diesel_spending": {year: 1_000.0},
+            },
+        },
+    }
+    simulation = Microsimulation(situation=situation)
+
+    fuel_duty = simulation.calculate("fuel_duty", year).values[0]
+    litres = (
+        simulation.calculate("petrol_litres", year).values[0]
+        + simulation.calculate("diesel_litres", year).values[0]
+    )
+    rate = system.parameters.gov.hmrc.fuel_duty.petrol_and_diesel(year)
+
+    assert fuel_duty == pytest.approx(litres * rate)

policyengine_uk/variables/gov/hmrc/fuel_duty/fuel_duty.py

@@ -1,8 +1,5 @@
 from policyengine_uk.model_api import *
 
-STATUTORY_CONSUMER_INCIDENCE = 0.5
-ECONOMIC_CONSUMER_INCIDENCE = 1
-
 
 class fuel_duty(Variable):
     label = "Fuel duty (cars only)"
@@ -15,9 +12,4 @@ def formula(household, period, parameters):
         fd = parameters(period).gov.hmrc.fuel_duty
         petrol_litres = household("petrol_litres", period.this_year) / MONTHS_IN_YEAR
         diesel_litres = household("diesel_litres", period.this_year) / MONTHS_IN_YEAR
-        return (
-            fd.petrol_and_diesel
-            * (petrol_litres + diesel_litres)
-            / STATUTORY_CONSUMER_INCIDENCE
-            * ECONOMIC_CONSUMER_INCIDENCE
-        )
+        return fd.petrol_and_diesel * (petrol_litres + diesel_litres)

policyengine_uk/variables/household/consumption/diesel_litres.py

@@ -7,7 +7,7 @@ class diesel_litres(Variable):
     entity = Household
     definition_period = YEAR
     value_type = float
-    unit = GBP
+    unit = "litre"
 
     def formula(household, period, parameters):
         return household("diesel_spending", period) / household("diesel_price", period)

policyengine_uk/variables/household/consumption/petrol_litres.py

@@ -7,7 +7,7 @@ class petrol_litres(Variable):
     entity = Household
     definition_period = YEAR
     value_type = float
-    unit = GBP
+    unit = "litre"
 
     def formula(household, period, parameters):
         return household("petrol_spending", period) / household("petrol_price", period)