Drivers’ hip pocket hit again with petrol tax increase

FROM tomorrow the taxman is going to be dipping deeper into your pocket when you pull in to top up your petrol tank.

The second round of the Australian Government's increase of the petrol tax by indexation will add an extra one cent a litre to the bill. It might sound like a marginal increase, but according to the NRMA deputy president, Wendy Machin, it will add up in the long run.

"Had the NRMA not fought to cap indexation in 2000, petrol prices would be 20 cents higher now than they already are," Ms Machin said.

"That means that instead of Clarence motorists paying an average of 148 cents as they do today, they would be paying upwards of 168 cents a litre for an essential household commodity.

"We want to see a stronger commitment from the government for long-term funding.

"Motorists have been hit with a double tax whammy: they already pay GST on top of the petrol tax.

"This hip-pocket hike would be easier for our Members to take if more was going back into vital roads and public transport.

"The only guarantee we've had is for a one-off $1.1 billion injection for the Roads to Recovery program, which is good, but it's not enough."

Indexation was abolished in 2009, to offset the introduction of the GST, but in May 2014, the Federal Government announced it would return indexation on petrol. This means the price of petrol will rise twice a year every year in line with inflation. The Federal Opposition supported the policy.

The increased tax on petrol has already gone up by more than one cent per litre. Within 10 years, indexation will add an additional 20 cents per litre to the price at the bowser.

Ms Machin said motorists were disappointed the government had increased the tax, with almost nothing returned over the long-term by way of road funding.

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