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Taking 5c levy off petrol would be short relief

26 August 2005

Taking 5c levy off petrol would be a very short relief

The rapid and probably permanent rise in the price of petrol means that removing the Government's 5c-a-litre roading levy, as the AA is suggesting, would give motorists no more than a week or two's respite, Green Co-Leader and Transport Spokesperson Jeanette Fitzsimons says.

"Calls such as this one from the AA seem to be based on the assumption that what we're seeing at the moment is some sort of temporary anomaly. Let's get real and face up to the fact that the world has arrived at the end of cheap oil and prices are never permanently coming down again.

"Removing the roading levy from petrol without a corresponding cut in the Government's roading budget would mean everyone would be subsidising owners of gas guzzlers. Such a situation would also penalise those making the effort to become more fuel-efficient and would hold back progress on alternatives such as public transport at the very time that we need them most.

"If there's something we should stop adding too much of to the price of petrol within New Zealand, it should be our refining company's profit margin, not a Government levy. New Zealand Refining's 80 percent rise in profits to $62 million, announced yesterday, suggest the profit margins on petrol in New Zealand are now too high.

"This is the same company who negotiated through a greenhouse agreement for an exemption from the new carbon tax, in return for improving their refinery's efficiency. It's not fair that companies that benefit from carbon tax exemptions, which their customers ultimately have to pay, are then making an excessive profit. If they aren't prepared to keep their profit margins to a reasonable level, there could be a need to regulate."

ENDS


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