Drivers in remote areas will be given a 5p a litre discount on their petrol under plans put forward by ministers. Three locations in England and seven in Scotland have been selected after deciding they meet strict criteria to justify a cut.
The Government has applied to the European Commission to vary the duty rates in the 10 towns.
Discounts have never been permitted on the mainland before, although they are already in place for the Scottish islands, Isles of Scilly and other island communities in Europe.
Chief Treasury Secretary Danny Alexander said the "strongest possible evidence" had been put together to secure an extension.
The areas selected have consistently higher pump prices than are available in locations that already receive a discount.
They are also more than 100 miles by road from the nearest refinery, and have a population density lower than 135 people per square kilometre.
Labour highlighted that eight out of the 10 towns are in constituencies with Lib Dem MPs, and two in the seat held by Chief Secretary to the Treasury Danny Alexander.
Catherine McKinnell, Labour economy spokesman, said: "The public will want to be reassured this is no more than a coincidence because nobody will thank a Lib Dem Treasury Minister who refuses to tackle the cost of living crisis everywhere but his own back yard."
Mr Alexander insisted: "This has been a completely objective process. The list has been drawn up with pretty strict criteria."
He added: "As a Highlander, I know all too well that fuel prices tend to be highest in areas where a car is needed the most.
"We've already delivered a tax cut for remote islands and now want to extend that to mainland rural areas that suffer from similarly high prices to the islands.
"We've put together the strongest possible evidence base to try and maximise the places that get it.
"As I've said before, it won't be easy to get this agreed with the Commission, but I will do everything I can to make this happen."
The commission is expected to announce its decision on the proposal next year.
Retailers in the approved areas then register with HM Revenue & Customs to claim the relief on unleaded petrol and diesel for sale to the public.
The towns chosen for the application are:
:: Acharacle, postcode PH36 (Scotland - Lochaber)
:: Achnasheen, IV22 (Scotland - Ross & Cromarty)
:: Appin, PA38 (Scotland - Argyll and Bute)
:: Carrbridge, PH23 (Scotland - Badenoch and Strathspey)
:: Dalwhinnie, PH19 (Scotland - Badenoch and Strathspey)
:: Gairloch, IV21 (Scotland - Ross & Cromarty)
:: Hawes, DL8 3 (England - North Yorkshire)
:: Kirkby-in-Furness, LA17 (England - Cumbria)
:: Lynton, EX35 (England - Devon)
:: Strathpeffer, IV14 (Scotland - Ross & Cromarty)
The Government has applied to the European Commission to vary the duty rates in the 10 towns.
Discounts have never been permitted on the mainland before, although they are already in place for the Scottish islands, Isles of Scilly and other island communities in Europe.
Chief Treasury Secretary Danny Alexander said the "strongest possible evidence" had been put together to secure an extension.
The areas selected have consistently higher pump prices than are available in locations that already receive a discount.
They are also more than 100 miles by road from the nearest refinery, and have a population density lower than 135 people per square kilometre.
Labour highlighted that eight out of the 10 towns are in constituencies with Lib Dem MPs, and two in the seat held by Chief Secretary to the Treasury Danny Alexander.
Catherine McKinnell, Labour economy spokesman, said: "The public will want to be reassured this is no more than a coincidence because nobody will thank a Lib Dem Treasury Minister who refuses to tackle the cost of living crisis everywhere but his own back yard."
Mr Alexander insisted: "This has been a completely objective process. The list has been drawn up with pretty strict criteria."
He added: "As a Highlander, I know all too well that fuel prices tend to be highest in areas where a car is needed the most.
"We've already delivered a tax cut for remote islands and now want to extend that to mainland rural areas that suffer from similarly high prices to the islands.
"We've put together the strongest possible evidence base to try and maximise the places that get it.
"As I've said before, it won't be easy to get this agreed with the Commission, but I will do everything I can to make this happen."
The commission is expected to announce its decision on the proposal next year.
Retailers in the approved areas then register with HM Revenue & Customs to claim the relief on unleaded petrol and diesel for sale to the public.
The towns chosen for the application are:
:: Acharacle, postcode PH36 (Scotland - Lochaber)
:: Achnasheen, IV22 (Scotland - Ross & Cromarty)
:: Appin, PA38 (Scotland - Argyll and Bute)
:: Carrbridge, PH23 (Scotland - Badenoch and Strathspey)
:: Dalwhinnie, PH19 (Scotland - Badenoch and Strathspey)
:: Gairloch, IV21 (Scotland - Ross & Cromarty)
:: Hawes, DL8 3 (England - North Yorkshire)
:: Kirkby-in-Furness, LA17 (England - Cumbria)
:: Lynton, EX35 (England - Devon)
:: Strathpeffer, IV14 (Scotland - Ross & Cromarty)