The Australian Trucking Association has welcomed the commitment of the Coalition to consult with industry regarding the implementation of its fuel excise reduction plan should it win the upcoming federal election.
Opposition Leader Peter Dutton has promised to half the current fuel excise on petrol and diesel from 50.8 cents per litre to 25.4 cents per litre in a move he says will deliver more immediate cost of living relief than the Labor government’s proposed long-term tax cuts.
The cost of a 12-month halving of the excise would come in at $6 billion.
ATA CEO Mathew Munro says the Coalition’s previous short-term cutting of the excise under Scott Morrison in 2022 created issues for the transport sector due to the lack of consultation.
“The ATA welcomes the Coalition’s commitment to work with industry on the details of the policy if it wins election,” Munro says.
“The Morrison government halved the fuel excise in the March 2022 Budget but did not reduce the road user charge by the same amount.
“As a result, the decision created significant issues for trucking businesses.”
NatRoad CEO Warren Clark believes the industry’s Fuel Tax Credits must be protected should there be any excise cut in order for road transport to feel the relief.
The current Fuel Tax Credit for heavy vehicles on public roads is 20.3 cents per litre until 20 June 2025.
A 25.4 cents per litre reduction to the fuel excise would result in a reduction of just 5.1 cents per litre for heavy vehicles, alongside the suspension of Fuel Tax Credits.
“Under the former Coalition government the decision to halve the fuel excise also meant the suspension of Fuel Tax Credits,” Clark says.
“This wiped out the benefits of the tax cut, throwing cashflow for small road freight businesses into crisis.
“We welcomed the restoration of Fuel Tax Credits under Labor back in 2022. The Coalition must now commit to protecting Fuel Tax Credits in full.
“About 98 per cent of the road freight industry consists of small businesses. Average profit margins are just two per cent.
“Small trucking businesses lack the economic bargaining power to simply pass on higher costs. Fuel Tax Credits have a heavy impact on cashflow management.
“Unless Fuel Tax Credits are protected for the duration of the policy, the benefits of lower excise will not flow on to small trucking businesses.
“Instead, many in the industry that keeps Australia’s shelves supplied could face financial ruin.”
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