Archive, Industry News

Freeze fuel excise on trucks, ATA tells Federal Government

Industry group’s pre-Budget submission says trucking industry continues to be overcharged.

 

The heavy vehicle fuel excise should be frozen until trucking operators are no longer overcharged for using the road network, the Australian Trucking Association (ATA) has told the Federal Government.

The ATA’s pre-Budget submission for the 2015-2016 financial year recommends maintaining the excise at 26.14 cents a litre for the next financial year.

ATA CEO Stuart St Clair says the industry continues to be charged too much and that governments should implement a National Transport Commission (NTC) recommendation to address the over-recovery. 

“The state transport ministers put off implementing the NTC recommendations until 2016, although the Australian Government acknowledged the over-recovery and decided to freeze the road user charge in 2014-15,” St Clair says.

“The trucking industry is still being overcharged. As a result, the Government should continue to freeze the road user charge until this overcharging has been addressed.”

St Clair says the existing system used to calculate heavy vehicle fees has led to trucking operators being overcharged by more than $200 million this financial year.

The ATA’s submission also recommends keeping the 12.76 cents per litre fuel tax credit in place.

“Without the fuel tax credit the industry would be paying the full price for a business input and would pass on the cost [to] the community leading to an increase in the price of freighted goods,” the submission states.

The ATA wants the Government to increase the small business threshold from $2 million $3 million and for it to look at the feasibility of increasing it to $5 million.

It says the current threshold, which has not been updated since 2007, does not capture all small businesses in the trucking industry.

The ATA says a trucking operator can have turnover of more than $2 million but may employ less than 20 workers.

“The amount of turnover is considerable but the resources available to complete tax administration, including business activity statements, superannuation payments and other tax responsibilities may not be sophisticated,” the submission says.

St Clair says raising the threshold to $3 million will reduce the red tape and tax compliance businesses currently face.

The submission goes on to advocate the adoption of recommendations from PricewaterhouseCoopers on reforming road supply and charging.

The recommendations include separating the road network into three tiers, which will target investment, reporting and funding on the basis of the level of service provided.

Furthermore, the recommendations will impose new reporting, benchmarking and reviewing requirements on state, territory and local governments.

The ATA also supports a Productivity Commission recommendation that, if implemented, will put conditions on funding the Federal Government provides to local, state and territory governments.

“Grants currently given by the Commonwealth to states and local governments are not made on a conditional basis. This means that there are loose guidelines governing where monies originally earmarked for roads are spent,” the ATA’s submission says.

Finally, the ATA has urged the Government not to neglect periodic road maintenance in favour of big-ticket infrastructure announcements.

Its submission says many major projects come at the expense of small scale projects that could be implemented to postpone or avoid the need for costly upgrades.

“Evidence from the Newell Highway shows strategic investment can improve safety significantly, at lower cost than dual carriageways,” the ATA says.

“The issue of periodic maintenance cannot be ignored if the road quality and stock of Australia is to improve. Budgets for maintenance are reducing over time and there is a need to address the issue of poor maintenance programs.”

The Federal Government is currently receiving submissions on what should be included in the 2015-2016 Budget.

Treasurer Joe Hockey is expected to hand down the Budget in May.

Previous ArticleNext Article
Send this to a friend