Govt outlines fuel cut plans

In News3 MinutesBy NZ Trucking magazineMarch 18, 2022

The has announced it will Government will cut 25 cents a litre off fuel for three months as part of a cost of living package.

Prime Minister Jacinda Ardern this week said petrol excise duty and road user charges will both be cut by 25 cents a litre for the next three months. Public transport fares will also halve for the same period, with a further announcement on road user charges expected in the coming days.

The fuel cuts will reduce the cost of filling up a 40 litre tank of petrol by between $11 and $17, at a cost of $350 million for the government.

“We cannot control the war in Ukraine nor the continued volatility of fuel prices but we can take steps to reduce the impact on New Zealand families,” Ardern said.

“While forecasters predict inflation will peak and subside over the coming year, there is less certainty around fuel costs due to the volatility of Russia’s invasion of Ukraine.

“One thing we do know, is that the extraordinary increases we’ve seen in recent weeks impact on everything – from the ability of people to get to and from work, to the cost of supplying goods and services, and so we must act to support New Zealanders to get through,” she said.

Finance Minister Grant Robertson said reducing FED is the quickest move the Government can make.

“Due to the nature of RUC, officials are working through a number of options to make sure support flows in a timely way, and the transport minister will be setting out the details for how we will support RUC payers in the coming days,” he said.

“The estimated cost of this cut over the thre-month period is about $350 million for the fuel tax changes. This will mean reduced revenue for the National Land Transport Fund, which funds our investment in roads and other transport infrastructure,” Robertson added.

“We will be meeting the costs of this through savings and reprioritisation from the COVID Response and Recovery Fund. This means we can continue the Government’s record investment into transport infrastructure without having to cut projects.”