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Petrol price to rise on November 10
The government has threatened motorists with no refund if fuel tax not approved
31 Oct 2014
THE federal government has used special powers to raise the tax on fuel without parliamentary approval and has threatened to pass the revenue raised onto oil companies and not return it to motorists if it’s blocked in parliament.
Announced by finance minister Mathias Cormann, the fuel excise will increase from 38.14 cents to 38.6 cents on November 10. According to Mr Cormann the impact on households would be modest, translating to an extra 40c to fill a 50-litre tank.
The measure would see the reintroduction of the twice-yearly indexation of fuel prices put on hold by the Howard government and outlined in the May budget. The second increase will take place on February 1, 2015. Over four years the net revenue would be $2.2 billion.
By using a tariff proposal the fuel tax can be increased, but if legislation is not validated within 12 months the revenue must be refunded. Labor and the Greens are expected to block the measure.
Mr Cormann said he was confident it would be validated but said that if it is not the refund would be given to oil companies and not consumers.
“The question for Bill Shorten and Christine Milne is whether in 12 months’ time they want the additional revenue collected through this measure to be refunded to the fuel manufacturers and fuel importers or whether they want to see this additional revenue invested in job creating and productivity enhancing road infrastructure which will help us build a stronger more prosperous economy,” he said.
Opposition leader Bill Shorten described the move as an ambush on Australian motorists.
“These are increased petrol taxes that Tony Abbott said would never happen under a government he led,” he said.
“Tony Abbott said yesterday he wants a mature debate, and yet today, he ambushes Australian motorists he ambushes the parliament of Australia, and through the backdoor he's launched a sneak attack on the wallets and cost of living of every Australian.”
The Australian Automobile Association (AAA) which represents the nation’s car clubs including the NRMA and RACV called the increase in fuel tax “completely unjustified”.
Echoing Mr Shorten’s views, AAA chief executive Andrew McKellar said the move was unfair.
“This is a sneaky and tricky move to introduce an unfair and unjustified tax on ordinary motorists via the backdoor,” he said.
“This government has shown contempt for the motoring public and also for the parliamentary process in this country.
“We need a guarantee that if this measure is not passed by the Senate that all unjustified taxes collected during this period will be refunded to the consumers who paid it.”
Victorian Automobile Chamber of Commerce executive director David Purchase said he is appalled by the government’s threat not to reimburse consumers.
“The federal government wants to take more money off motorists and consumers, who already pay quite enough tax on fuel, and is threatening to give it to fuel companies if it doesn’t get its way,” he said. “This is not the way politics should be done in Australia.
“Motorists are not cash cows to be exploited and the federal government has to stop milking them dry. Road users cannot be expected to keep giving as they already pay road tolls, insurance premiums, vehicle registration, licence fees and high fuel prices. Enough is enough.
“The decision to increase fuel excise shows the Federal Government is penalising motorists for using vehicles and views road users as an easy revenue source.”
The fuel excise was due to take effect on August 1 this year and the government has lost about $35 million due to the three-month delay.
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