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Yet Another Tax Increase For Motorists

1 March 2005
Yet Another Tax Increase For Motorists

Farmers are frustrated by news of the imposition of yet another tax increase, said Charlie Pedersen, Vice President of Federated Farmers of New Zealand (Inc).

The government has chosen to increase the petrol excise tax by five cents plus GST a litre from 1 April to raise $207 million a year for roading projects. This will take the total amount of tax on petrol to 52.8 cents a litre.

“Since 2000 there has been a proliferation of new and increased taxes and charges which have helped lift total government revenue as a percentage of GDP from 38% in 2000 to 43% in 2004,” said Mr Pedersen.

Although welcoming the additional investment on roads, Mr Pedersen observed that the government didn’t need to wallop the road user with higher petrol prices to raise money for roading.

“If the government really cared about the impact on motorists, it would have used the $600 million a year they currently for petrol tax take for roads and spend on other things.

“As Finance Minister Michael Cullen admitted to a question in the House, he could not think of a single tax, levy or duty that had been reduced by this government.

“High and growing taxes discourage innovation, productivity, saving and investment – all things the government says it wants more of. It’s time for some fresh thinking on tax,” concluded Mr Pedersen.


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