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Motorists may pay price for ethanol tax break

Gerry Brownlee MP National Party Energy Spokesman

10 September 2003

Motorists may pay price for ethanol tax break

The Labour Government may be forcing major repair bills on to Kiwi motorists with an ideological drive to get oil companies using more ethanol, says National Party Energy spokesman Gerry Brownlee.

He's commenting after the announcement that 'ethanol used in petrol blends is to be free from excise duty for at least two years, in recognition of its environmental benefits'.

"The jury is still out on the claim of 'environmental benefits' but new research from Australia shows that the motoring public could be in line for an unpleasant shock.

"According to an Australian Government ethanol working group up to one third of Australia's 10 million cars will not operate satisfactorily on petrol containing 10 per cent ethanol - the level deemed safe by Canberra.

"Worst hit will be those vehicles manufactured before 1986, Ford Falcons made before 1998 and a variety of late model vehicles including Toyota, Suzuki and some high performance cars.

"In Australia they've been looking at an extensive pump labelling regime, although the ethanol working group has now concluded that it was impractical to give detailed information at petrol stations.

"Instead they're to refer drivers to call centres or websites.

"The list of cars that don't operate properly on ethanol is far longer than anyone predicted in Australia - yet to my knowledge no such research has been carried out in New Zealand.

"The Labour Government should have done its homework before giving oil companies a multi-million dollar tax incentive to use more ethanol.

"The idea might suit Labour's agenda, but Kiwi car owners may end up footing the bill," Mr Brownlee says.

Ends

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