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Petrol Prices Rise - A Windfall To The Taxman?

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Petrol Prices Rise - A Windfall To The Taxman?

Just how much has the price of petrol risen in the last 12 months?

Motor Trade Association (MTA) Chief Executive Stephen Matthews has pointed out that since price hikes for fuel began in July 1999, as upwards of 30c has gone on to the price of a litre of fuel so the government has collected an extra $50M in GST from motorists.

"Our 700+ MTA member service stations are actually unpaid tax collectors for the government and they have to take the motorists anger to boot" says Stephen Matthews.

"The average fuel drop" at a service station sees the MTA member having to finance anything between $20,000 and $50,000. There's a cash-flow issue here. Rising prices hurt our members too" he says. The Motor Industry continues to see reduced margins on top of extra costs and increased investment.

The real culprits says Stephen Matthews are OPEC for restricting supply of crude, the NZ USD exchange rate and this country's GST. In the last 12 months he estimates the Government has netted an additional $50M through the steadily rising petrol and diesel price, an amount which mainly comes from the sector who simply cannot pass the cost on: the private motorist.

Alliance Leader Jim Anderton continues to claim that the oil companies are fleecing the consumer, but I see no evidence of this at all. NZ Petroleum prices have remained competitive with Australia and the major Asia-Pacific refining centre of Singapore.

Stephen Matthews says the Government could assist in reducing fuel prices by reducing excise tax so that the tax component does not rise with fuel costs. This could reduce the price immediately by nearly 4 cents per litre.

"I am confident that oil companies will pass the benefit of any tax reduction to the consumer" he says.

ENDS

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