Petrol for 35p a litre?

Nestling in the hills of rural Scotland, the Auld Brig Filling Station could be every motorists dream.

It's selling the cheapest petrol in Britain - 35 pence per litre - that's less than half the average price of 92p.

For an annual fee of £100, drivers have been able to join what's called the Motor Vehicle Protection Association. Because they're taking part in what the organiser says is research, they qualify for up to 50 litres of cheap fuel a week.

James McDonald claims to be developing a machine that cuts carbon emissions by 90 per cent while doubling fuel efficiency. It's called the ripple generator but he was unable to show us an example. And he's yet to fit one to any of the cars who've joined his club to test them out. He says they're not ready but environmentalist want an investigation

Mr Mcdonald says his research qualifies him to reclaim all the tax back on the fuel he imports through this refinery because of an EU directive supporting scientific research. Revenue and Customs told us relief does exist for fuel used in research, but not if that fuel is being used on the roads.

But could he have found a genuine loophole?

Mr Mcdonald does have a previous conviction for fraud. But it hasn't deterred 900 people from signing up to his association.

Mr Mcdonald is still waiting to find out if his tax will be returned. For now he's selling cheap fuel at a personal loss. But if he succeeds in his ambition to attract 16,000 members to his Association & reclaims the tax for all their fuel, he could be end up with a significant profit - that will come from the Chancellor of the Exchequer's pocket.

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