New Zealand AA Says No To Carbon Tax On Fuel

by Mary Swire, Tax-News.com, Hong Kong

03 August 2011

The New Zealand Automobile Association (AA) has called for an exemption from carbon tax on fuel, to match the plans currently being made in Australia.

Australian Prime Minister Julia Gillard has confirmed that Australia’s new carbon tax, due to be implemented in July 2012, will not apply to fuel for individual motorists because the government believes drivers are already struggling with high fuel prices.

The AA says that a AUD25 (USD27) per tonne carbon tax would have added about six cents a litre to the cost of fuel. In New Zealand, the Emissions Trading Scheme imposes a cost of about three cents per litre, but once the current two-for-one deal is lifted in 2013, this could rise to six cents per litre at current carbon prices.

“In Australia, the current retail price of 91 octane is under AUD1.40 per litre, thanks to lower fuel taxes and a higher exchange rate. If it’s good enough for Australia to exempt fuel from a carbon tax, then it’s certainly good enough for New Zealand,” says AA PetrolWatch spokesperson Mark Stockdale.

“The AA believes that an emissions tax on fuel is unnecessary as higher fuel prices are already encouraging motorists to reduce their fuel consumption and therefore carbon dioxide emissions.”

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