Transport ministers propose a 2.5 per cent increase in road user charges
The National Transport Commission (NTC) is inviting public and industry views on the proposal to increase heavy vehicle registration and road user charges in 2021–22.
In support of its effort, the commission has released its Heavy Vehicle Charges Consultation Report, which poses three questions for those affected:
- Which costs are typically passed through to customers (and to end consumers) and which costs are absorbed by vehicle owners or operators?
- Is the pump price of fuel a cost that is charged separately under typical hire-and-reward contracts (such that fuel price fluctuations do not impact profit margins)?
- Does the answer depend on the size of the business and their contract bargaining power?
“Any information provided on these questions will help inform Ministers about the broader context in which their final decision on heavy vehicle charges will be made,” the report states.
Read how the road user charge freeze was greeted last year, here
The public consultation is being carried out following the Infrastructure and Transport Ministers Meeting (ITMM) last month that proposed a 2.5 per cent increase be applied to the roads component of registration charges in 2021–22.
This will increase the road user charge (RUC) to 26.4 cents per litre on July 1.
The regulatory component of registration charges will be reset on a cost recovery basis for 2021–22, with minimal changes expected.
This means that the overall increase in total registration charges including both regulatory and roads components is expected to be slightly below 2.5 per cent.
The proposal comes in response to the end of a previous decision to freeze heavy vehicle charges that expires on June 30.
The NTC estimates that to ensure governments recover the amount spent on providing roads to heavy vehicles in 2019–20, current heavy vehicle charges would need to rise by 13.4 per cent for 2021–22.
If no decision is taken by ITMM, heavy vehicle charges would be automatically increased by 13.4 per cent for 2021–22 under the annual adjustment formula contained in the Heavy Vehicle Charges Model Law.
Heavy vehicle charges, which apply to all vehicles with a Gross Vehicle Mass (GVM) of above 4.5 tonnes, consist of RUC on diesel fuel and a yearly registration charge comprising roads and regulatory components.
The NTC will accept submissions on this matter until March 12.
The consultation report can be found here.