The Australian Government should extend its reductions to fuel excise and the truck road user charge beyond their 30 June end date, Australian Trucking Association CEO Mathew Munro said today.
The ATA is a united voice for its members on trucking issues of national importance. Through its 13 member associations, it represents the 60,000 businesses and 200,000 people who make up the Australian trucking industry.
From 1 April, the Government reduced fuel excise by 32 cents per litre from 52.6 to 20.6 cents per litre. The Government also reduced the heavy vehicle road user charge from 32.4 cents per litre to zero.
The road user charge determines the fuel tax credits that the operators of on-road heavy vehicles receive on their monthly or quarterly business activity statements. Both reductions end on 30 June.
Mr Munro said that trucking businesses would have difficulty managing such large increases in excise and the road user charge.
“There are trucking businesses teetering on the brink, and a big jump could be disastrous for them,” Mr Munro said.
“The Fair Work Commission’s fuel cost recovery order has helped many trucking businesses recover more of their fuel costs, but the order only requires rate adjustments or fuel levy changes every fortnight or twice a month.
“That’s a long period for a small trucking business to have to pay an extra 32 cents per litre for fuel with no prospect of getting the money back, and some businesses are not getting timely or full rate adjustments anyway.
“The ATA is also concerned about the impact of such a large excise increase on demand. There would be a massive spike in fuel purchases in the last week of June, with motorists and truck operators seeking to buy fuel at the lower rate,” he said.
Mr Munro said the ATA’s preference would be for the full reduction to be extended until the crisis was completely over.
“An alternative would be to soften the blow, and manage uncertainty, by increasing fuel excise and the road user charge in stages over the next three months,” he said.
“If the Government were to decide on a staged approach, it would be essential to increase fuel excise and the road user charge in parallel.
“Monthly increases would minimise the number of fuel tax credit changes that businesses would need to process, while enabling the transition to occur within a reasonable time.
“Another advantage is that the Government would be able to extend the timings if there were delays in the US-Iran negotiations under this week’s MoU,” he said.
Mr Munro said that it would take many months for Australia’s fuel supply and prices to return to normal.
“We are still likely to see 9-12 months of elevated prices as global supply chains return to normal and economies restore their fuel reserves – and all of that assumes the peace deal holds,” he said.
