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Minister’s claim fuel tax not regressive is rubbish

Jami-Lee Ross - Transport

28 June 2018

Transport Minister Phil Twyford is fast losing what credibility he has left as he tries to claim that his regional fuel tax is not regressive, National’s Transport spokesperson Jami-Lee Ross says.

“Twyford is taking New Zealanders for fools if he thinks he can convince them that his regional fuel tax will not hit people on low incomes the hardest.

“Let’s be clear – this is a regressive tax and any claims otherwise fail to acknowledge the fact that low income households pay a much higher percentage of their total income on fuel than higher income households.

“This occurs for a number of reasons. Those who are on a lower income are more likely to live further away from main centres and they are also less likely to have newer and more fuel efficient cars.

“This means that people on lower incomes are more reliant on fuel because they need to drive further and consume more fuel when they drive.

“Those who can afford a newer and more fuel efficient car will be less impacted by this tax and can avoid it altogether if they buy an electric car.

“The risk of this regressive tax was specifically noted by the Ministry of Transport in its Regulatory Impact Statement.

“Twyford has also, as recently as last week, said himself that his regional fuel tax is regressive and he takes the regressive nature of the tax very seriously.

“To now claim that this tax is not regressive is nothing more than political spin and does nothing to ease New Zealanders’ concerns about the rising cost of living.”

ends

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