Wednesday, April 24, 2024

Government fulfils promise to scrap Auckland Regional Fuel Tax

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The coalition Government has signalled its intention to spend remaining Regional Fuel Tax money on projects such as the Eastern Busway, pictured. File image supplied
  • By Christopher Luxon, Prime Minister and MP for Botany

Last week, the coalition Government announced that from July 1 we’ll be scrapping the Auckland Regional Fuel Tax (RFT), which added 11.5 cents per litre tax on fuel for Aucklanders.

Throughout the campaign those of you in our electorate continued to tell me the tax was putting an unnecessary extra cost onto your household budgets while you were already coping with the cost-of-living struggles.

Roughly half of the money raised by the tax so far is still unspent, meaning some of you were being taxed more without seeing any benefit in return.

Removing this additional tax will help ease that burden a little and provide some relief for those who were feeling the pinch.

The tax was supposed to help fund important projects like Mill Road and Penlink.

While Mill Road was cancelled, and Penlink received full Crown funding, Auckland Transport has used RFT revenue to fund many non-roading projects including more cycle lanes, red light cameras, speed humps, and the lowering of speed limits across the city.

Aucklanders have repeatedly been told there’s not enough money to fund major infrastructure upgrades, with projects like the Eastern Busway suffering from budget shortfalls.

But with more than $340 million in RFT cash sitting unspent, it’s becoming increasingly difficult for our local commuters to accept such excuses and the resulting delays in delivery.

Auckland is facing significant infrastructure challenges.

Population growth combined with years of poor road maintenance and degradation have made it harder to get around.

Our city needs real investment now to get projects under way that will reduce congestion and improve transport options, particularly in poorly served areas.

The Government has signalled our intention to spend the remaining RFT money on projects that will do just that, namely the Eastern Busway, City Rail Link electric trains and stabling, road corridor improvements, and some growth-related transport infrastructure.

The cost to build the infrastructure New Zealand desperately needs is high, and we cannot continue to rely on increasing fuel taxes to pay for everything we want.

The Government is committed to seeking new funding methods that will allow us to build the infrastructure we need sooner rather than later.

This could include the use of value capture, tolling, and public-private partnerships, and we have agreed with Auckland Council and mayor Wayne Brown to prioritise enabling time-of-use charging to help deliver more reliable journeys.

The reality is a fuel tax is an increasingly regressive form of taxation, with low-income earners disproportionately affected as cheaper, less fuel-efficient vehicles use more fuel than their pricier modern alternatives.

This is why the Government ultimately intends to do away with fuel excise duties in favour of user-pays, by eventually bringing all vehicles into the road user charges (RUC) system.

For now, the removal of regional fuel taxes will allow Aucklanders to go further with what they’ve got and make filling up the car a little less daunting.

In more local news, I thoroughly enjoyed being in the electorate to attend the Fo Guang Shan Buddhist Temple, seeing in the Lunar New Year with thousands of Aucklanders.

It’s important for me both as your local MP and now as Prime Minister to spend time with all our diverse and multicultural communities.

Botany is lucky to boast a diverse population of Kiwis from different ethnic, cultural, and religious backgrounds and your contribution to our community and wider New Zealand society is welcomed and honoured.

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