10 Oct 2017

Fuel tax increase considered for Akl transport

6:31 pm on 10 October 2017

The government explored increasing fuel taxes to pay for roading projects, despite criticising Labour's plan for a 10 cent regional fuel tax, official documents show.

No caption

Photo: AFP

Internal memos and briefings, released to the Green Party, showed Transport Minister Simon Bridges was told by his ministry how to close the funding gap in the Auckland transport budget.

It said the government was responsible for $1 billion to $2.1bn of the $5.9bn funding hole, with Auckland Council responsible for the remainder.

The ministry gave Mr Bridges several options in May, including increasing fuel taxes by 1 or 2 percent each year, delaying major projects, or using more Crown funding.

Two months later the minister met with the Transport Agency, which gave him advice on how to get additional funding for improvements to Auckland urban corridors. He then asked his ministry to look at the implications of NZTA's proposal.

The ministry outlined four issues with the proposal, three of which were redacted, and the other was "whether and when additional funding is required".

The section dedicated to the options on how best to fund additional increases included a graph, which was redacted, but showed it looked at petrol excise duty against consumer price index (CPI) from 2008 to 2026.

A graph, also released to the Green Party, showed the ministry modelled a 5 cent fuel tax increase in 2018, followed by increases of between 10 and 20 cents in the nine years after that to plug any additional increments.

The ministry wanted to lodge the government policy statement on land transport with the Cabinet office by 3 August "at the latest" but it is yet to be made public.

Mr Bridges' office said he could not comment while there was a caretaker government and the statement would be released before the end of the financial year.

Get the RNZ app

for ad-free news and current affairs