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Jul 18

Time for a fair go on petrol

IT IS easy to lapse into complacency with our high petrol prices, or at least be quietly resigned to the power of oil companies and the giant supermarket chains.
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There have been inquiries and campaigns over the high price Tasmanians pay for petrol; sometimes 20¢ a litre above mainland prices, where volumes are higher and the competition is fierce.

Even fuel dockets are conditional on a trolley of groceries bought from the big chains, which have the market cornered.

Now the federal government is bringing back fuel indexation, axed in 2001 because of the GST and risky by-elections confronting the Howard government.

The federal fuel excise, now reaping almost $20 billion a year will snare even more with indexation, up to $4 billion more over the budget forward estimates.

This is a double tax slug. Fuel indexation will lift the price and then GST applies. Prime Minister Tony Abbott says it will add about 40¢ a week to a household budget, while the RACT suggests an extra $1.20 a tank for a family within 12 months.

So who are the villains? There are several. About 70 per cent of the revenue goes into the government’s coffers. Only a quarter is earmarked directly for roads.

We love a tax cut, but John Howard should never have frozen indexation in 2001. It was simply an inflation measure and had it always applied the excises would have been 55¢ a litre by now instead of 38.14¢ a litre. The budget would have had more than $20 billion in extra revenue, to pay for those services we demand.

The real villains in Tasmania’s case must surely be oil companies that always fail to convince us with excuses as to why we pay so much more than other regional areas.

Perhaps our Forum columnist today, Alexandra Humphries, is onto something when she argues for rail to supersede roads as a more efficient form of passenger and freight transport.

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