Soaring Prices Put New Fuel Tax At Risk
May 1st, 2008
Regional Councils may put off imposing new regional fuels taxes to help pay for new roading and public transport projects. This is because of growing fears of a backlash against taxes being imposed at a time of record high petrol prices. The Govt will introduce legislation on July 1 so Regional Councils can implement the fuel tax but road transport lobby groups are calling for fuel taxes to be shelved.
Tax Unpalatable. The Road Transport Forum wants the Govt to delay legislation allowing a regional fuel tax, and put off any bio-fuel or emissions taxes until the international fuel market cools. “NZers are already struggling to cope with the effects of record fuel prices,” says Forum CEO Tony Friedlander. The Automobile Association suggests motorists will balk at a 10 cents a litre fuel tax in Auckland on top of record petrol prices closing in on $2 a litre. “At the moment, any regional fuel tax would be extremely unpopular,” says the AA’s Mike Noon. “I think it’s going to be very difficult [for councils] to get the public’s mandate.”
Gradual Implementation. A spokesman for Transport Minister, Annette King, says rising petrol prices will have to be considered by any Regional Council looking to introduce a fuel tax once the enabling legislation is passed. She also favours a gradual introduction to lessen the impact “The Minister wouldn’t want a tax to be all in one hit. There may only be a change of one cent a litre. The [regional councils] wouldn’t be allowed to just bank money.” Meanwhile, Michael Cullen is opposed to any delay in the introduction of regional fuel taxes.
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