Petrol tax to rise for road work

JONO GALUSZKA AND FAIRFAX
Last updated 12:00 19/12/2012

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Manawatu motorists will soon be forking out an extra 9 cents a litre for petrol to subsidise roading projects outside the region.

The Government announced yesterday it plans to hike the price of driving, adding 9 cents a litre to the price of petrol by 2015. In each of the next three Julys, the Government will impose a 3-cents-a-litre rise to the excise tax component of petrol.

When announcing the tax increase, Transport Minister Gerry Brownlee said the money could be put towards four projects in the 2013-14 year, none of which would be in Manawatu.

"This announcement allows businesses and motorists to plan for the increases."

Mr Brownlee said the excise tax rise, which would be matched by higher road user charges on diesel, was required to deliver the roads of national significance (RONS), and maintain the value of the Land Transport Fund.

"These latest increases will also achieve that, and allow for continuing investment in the Government's state highway building programme and other transport projects." None of the RONS projects is based in Manawatu.

The announcement came just hours before the Government opened the books for its half-yearly economic update.

The increase in excise tax on petrol would lift Government income by up to $300 million a year but Finance Minister Bill English denied it was done to ensure the forecasts showed a surplus.

Labour leader David Shearer believes otherwise.

"National's promise on the surplus is too big to break. It has to get there. But it's forecast to get there with a razor-thin margin of just $66m by cutting jobs, selling assets and raising prices at the petrol pumps," he said.

"New Zealanders deserve better than a Government that is out of ideas and is just managing our decline."

The decision on petrol tax came as Kiwis were already struggling.

"This isn't the Christmas present that Kiwis expected. They're finding it hard enough to pay the bills now, let alone having to pay more for petrol to paper over the cracks in National's books."

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- © Fairfax NZ News

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