Transporting New Zealand opposes cutting fuel tax subsidy 

In News1 MinutesBy Gavin MyersApril 27, 2023

Ia Ara Aotearoa Transporting New Zealand is hitting out at the Government’s announcement that it will end the transport support package come June.

In March 2022, the Government cut 25 cents a litre from fuel taxes, and an equivalent amount from road user charges in response to a spike in the cost of fuel following Russia’s invasion of Ukraine.

However, Minister of Finance Grant Robertson this week confirmed the subsidy would come to an end this June.

Transporting New Zealand acting chief executive Dom Kalasih said the fuel tax subsidy package should continue until inflation has dropped below 6%.

“Since being introduced last year, the fuel tax subsidy has been extended a few times so we’re hoping it will continue,” he said.

Kalasih said each time a fuel tax change does occur, it brings significant administrative burdens associated with purchasing road user charges, and the increased costs need to be passed on.

“Trucks carry 93% of all freight in New Zealand, so costs will hit all consumers and businesses,” he said.

“Coming on the back of this week’s revised economists’ forecasts that inflation is likely to be weaker than expected, but still between 6.9% to 7.2%, the minister’s announcement is quite deflating.”