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Why Does Regressive Tax-Hike Not Tax All Users?

Why Does Regressive Tax-Hike Not Tax All Road Users?

New Zealand First Transport Spokesperson, Peter Brown MP, is asking why the Government has decided to raise the fuel tax by 4c a litre only on petrol, in order to allegedly fix the roading system in Auckland.

“This Government seems hell-bent on making it as expensive as possible to own a car. This is the second regressive tax that the Government has announced in short order—the first was the decision to add an average extra $4000 onto the price of imported cars,” said Mr Brown.

“It makes a mockery of the promise that Labour made before the election that they would not increase taxes for low income earners. Make no bones about it, this is a tax increase that will have a real affect on the spending power of income earners.

“Those who will have greatest part of their incomes affected by these decisions will be low income earners and working families. Petrol users are already hit by ACC charges, which diesel users are exempt from. They are then forced to pay 32.3 cents per litre in petrol tax, with GST on top. Of the 32 cents nearly 60% goes into the consolidated fund and only 40% into roading—that is simply unfair. To slap another 4 cents on petrol users and nobody else is a long way from being the fair and balanced approached promised. That is why New Zealand First will not be supporting the tax hike.

“There has already been much made of the spin that this tax-hike that it will pay for roading in Auckland. If that were really so then why do they not move the 18.7c a litre that petrol users pay into the consolidated fund into roading?

“Heavy-haulage users and diesel and gas car users will escape this tax-hike, despite the fact that they contribute significantly to the congestion problems in Auckland. I would suggest that diesel and gas powered vehicles are more prevalent in Auckland than in any other part of the country.

“The fact is that Tauranga, Wellington and all other parts of the country are being forced to pay twice for Auckland’s problems, whilst some Auckland motorists escape scott free.


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