Oil Levy Bill Passes Into Law

A bill raising a levy on oil to meet New Zealand’s international obligations to maintain oil reserves has passed its third reading.

The Energy (Fuels, Levies, and References) Amendment Bill was passed by 109 to 11 with NZ First opposed.

The bill expands the purpose of the Petroleum or Engine Fuel Monitoring Levy to include the cost of meeting the oil stockholding treaty obligation. It will help meet an obligation of about $10 million by 2016-17, and a shortfall of around about $20 million over the next 3 years. The levy will increase the price of petrol about 0.045 cents per litre.

New Zealand’s international treaty obligations require it to have 90 days of oil reserves. This is met with the holding of ‘tickets’ for offshore supplies which the levy will fund.

It was only opposed by NZ First who argued the cost should be met from general taxation.

MPs began debating the third reading of the Parole Amendment Bill.

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