Drivers are already angry every time they fill up at the pump and they’ll take no comfort from the Government’s willingness to double-dip on tax if petrol prices keep rising, National’s Finance spokesperson Amy Adams says.
“The Government imposed an excise tax increase of 4 cents a litre on petrol prices already at a record high and plans the same hikes in 2019 and 2020. It is stubbornly insisting more taxes are needed even though Kiwis are already reeling from rising living costs.
“The Associate Finance Minister has today signalled there will be no let-up for motorists if prices keep rising even though the Government may end up raking in as much in additional GST as it would from increases in excise. For example, if petrol prices go up by 30 cents, the GST on that alone would be 4 cents.
“The Government should cancel further fuel taxes if petrol prices keep rising as it will generate the same revenue from the GST alone. It should also own up to its part of the pain inflicted on drivers, since more than half the pump price is tax, instead of shifting all the blame onto oil companies.
“Fuel prices drove up consumer prices in the third quarter but the full impact on New Zealand’s economy is only starting to be felt as it shows up in the transport cost of getting raw materials to factories and finished goods and services to consumers.
“The Government insists more excise taxes and regional fuel tax are needed to fund infrastructure. A better strategy would be to cut wasteful spending like the $2.8 billion on fees-free tertiary education that hasn’t boosted numbers or the money thrown at a gondola for Whakapapa ski field.
“National would restore a policy framework that promotes economic growth, which is the only sustainable way to increase job opportunities and wages. Squeezing more tax out of motorists isn’t the answer.”