Consumers Will End Up Paying The Price Of Next Month’s Road User Charge Increase
The Government should abandon or at the very least postpone the 5.3 percent Road User Charge (RUC) due on July 1st.
“With every business fighting for survival from the Covit-19 lockdown, this is not the time to be increasing the cost of fuel,” says Michael Barnett, head of the Auckland Business Chamber.
This increase will impact freight companies hard – their tight margins mean that every cent will be passed on. “The cost of diesel is about $1.25/litre. Every time a small truck fills their 100 litre tank the increased cost will be about $12.50 – multiply that by every diesel vehicle and the cost increase runs into millions of dollars.
“Anyone using a diesel vehicle, freight costs and the cost of goods will all face a price increase, and the cost of living must rise, on one estimate cost increases of up to 2% will flow through to everything bought in NZ.”
Barnett said that while we need significant investment in infrastructure, an increase in RUC was not the solution especially with the country just starting to rebuild from Covit-19.
The increase in fuel costs undermines not just the road freight industry but every business seeking to reduce costs, and it won’t help keep workers in jobs.
“The increased fuel tax cuts across other areas where the Government is giving business good support,” said Barnett. He suggested the increase be abandoned or postponed for at least a year while industry recovers from Covit-19.