28 Jun 2018

Govt raises excise duty on fuel by 10.5 cents

2:31 pm on 28 June 2018

The government is raising the excise duty on petrol by 10.5 cents a litre over the next two years, on top of a regional fuel tax for Aucklanders coming into effect this weekend.

Closeup of woman  hand holding a fuel pump at a station.

Photo: 123rf.com

Transport Minister Phil Twyford said there needed to be increases in excises and charges to fund roads and public transport initiatives.

He said the petrol excise duty will rise by 3.5 cents a litre from 30 September, with further 3.5 cent increases in 2019 and 2020.

There will also be equivalent increases in Road User Charges from 1 October.

Mr Twyford said this would cost the average family 83 cents a week this year, rising to $2.50 a week by 2020.

Aucklanders are already facing an 11.5 cent rise in the cost of petrol, when the regional fuel tax comes into effect on Sunday.

Transport Minister Phil Twyford said the new regional petrol tax will enable the government to increase transport investment from $3.6 billion a year to $4 billion in 2018/19.

"Auckland alone loses $1.3 billion a year in productivity to congestion. We will tackle gridlock in Auckland by giving commuters options through major road projects and upgrades such as Mill Road and Penlink.

"Throughout New Zealand more commuters will be able to leave the car at home because of investment in public transport, walking, and cycling," Mr Twyford said.

The new money will be spent on roads and public transport and road safety, he said.

"The increased excise will fund $5 billion of investment over the next decade. If the Opposition intends to scrap this funding, they must explain which $5 billion worth of roads, public transport projects, and safety improvements they would cancel," Mr Twyford said.

The new 10 year plan at a glance

  • $3.6 billion in 2017/18
  • $4 billion in 2018/19
  • $4.7 billion a year by 2027/28
  • An additional $1 billion this year for specific projects, including the City Rail Link.
  • It will fund up to $9.5 billion for state highway improvements.
  • Extra excise duty of 3.5 cents from September 30, an extra 3.5 cents in 2019 and 2020.

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