Tax hike on petrol wins few fans

01:44, Dec 19 2012
petrol stand
Petrol prices are set to rise significantly during the next couple of years.

Motorists are unimpressed at Government plans to add 9 cents a litre to the price of petrol by 2015.

The Government announced yesterday its proposal to increase the price of driving, by putting a 3 cent per litre rise to the excise tax component of petrol in each of the next three Julys.

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 boost Government income by up to $300 million a year.

Each cent added to the pump price of petrol adds around $15 to the annual running cost for the average motorist.

Labour claims the increase is the only way National could reach surplus in the next three years.


Betty Dawson, of New Plymouth, said the increase was excessive.

"The rotten buggers, how much more are they going to add," she said.

She did not think it would have made any difference if Labour was in power.

"They all do the same thing."

Jim Pokere said the rise would hit the average working man.

"Especially for those with a family, it will also hurt those on a low income and have to use the car to take their kids to the doctor," Mr Pokere said.

Christine McEwen said the rise was a load of rubbish.

"It's about time that they tried to stabilise it and keep it down," Mrs McEwen said.

She said the increase would stop families from going away on holiday.

Bill Donald said it sounded like another tax grab.

"We're never happy when the price of petrol goes up," Mr Donald said.

Finance Minister Bill English said while the increase would have an impact on the Government's accounts, he denied it was done to ensure the forecasts showed a surplus.

Labour leader David Shearer thought 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."

Announcing the tax increase, Transport Minister Gerry Brownlee said the Government was keen to keep overall costs down for households and businesses.

"The cost of living, as measured by consumer inflation, is at a 13-year low and interest rates are at 50-year lows," Mr Brownlee said.

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

Mr Brownlee said the excise tax rise, which will be matched by higher road user charges on diesel, was required to deliver the roads of national significance, 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."

Taranaki Daily News