Gee, talk about ‘all shoulders to the wheel’. First it was the big announcement from the Rudd-bot about Fuelwatch which is predicted to, but may not actually, save us the grand total of… (wait for it… wait for it…) 1.5 cents a litre!
Whoa, tie me down: a whole 1.5 cents, I wonder what I’ll rush out and spend it on.
Then, not to be outdone, Dr Whatsisname comes back with a promise to slash (yes “slash” brothers and sisters) a full 5 cents off the petrol excise if the Liberals win Government. (Now let’s just play along for a bit and ignore the reality that the next election is three years away and my Aunt’s dead cat has more chance of winning than the riveting Dr Thingamyjig.)
But it’s a start; 5 cents is better than 1.5 cents, much better. (And you are aware, I presume, that you now pay 38 cents excise, plus GST on the total bill, for every litre you tip into your tank.)
So, to keep the banter on the front pages, the lad Rudd re-enters the field of battle and promises to “look” at dropping the GST on the excise part of the petrol.
Hmm, ok, better work that one out: excise is 38 cents, which is a tax, and GST, which is also a tax, is 10%, so… the GST tax on the excise tax comes to 3.8 cents. Which may, or may not, be dropped (got a feeling a focus group might be needed here).
Petrol heads rejoice!
But hang about, isn’t all this a bit like giving a bicycle to a fish? Good intentioned, great, simply great, but not really very useful.
You see, when I looked a few minutes ago, petrol was over $1.60 a litre. At that price, a typical sixty litre fill leaves enough change from one hundred bucks to buy three cupfuls of air and a watermelon pip.
Now I don’t want to seem ungrateful here, but someone really does need to point out that a saving of a whole 3.8 cents per litre isn’t going to bring people out into the streets doing cartwheels. It amounts to a total saving of $2.28 on a typical sixty litre fill.
Call me cynical, but I’m not sure that’s going to cut the mustard with those ‘working families’ we keep hearing about.
Now enter stage left the Taxation Institute of Australia (TIA). The TIA has called for the abolition of GST on petrol - outright. It says that Government is pocketing windfall GST increases every time there’s a price rise. “Every 1 cent increase in the bowser price means that working families will fork out an additional $17.3 million in taxes to State Governments (who get the benefits of GST collected).” The TIA reckons we already pay enough tax on fuel through the excise tax.
“If fuel prices reach $2.00 as forecast, this will mean an extra $865 million per year paid in GST for the benefit of States,” it said.
So, maybe the TIA has a point here: I mean, we’re already paying 38 cents a litre tax with the fuel excise, why do we then pay an additional tax in the form of GST?
To finish this little homily, here’s an interesting fact: Western Governments make more out of fuel through taxes and charges than the oil producing countries that pump it out of the ground.
Salutary eh?
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It’s very depressing, but I’m not expecting relief any time soon.
September last year it cost me $35 to refill at the bowser, now it’s more like $50 (I refill from 1/4 full and drive a three-year-old Barina).
I can only imagine how bad it must be for people with Commodores and 4WDs.
Its meant to be illegal to put a tax on a tax.
“Lucky” its an excise.
For me it will mean prices go up.
Im the bloke who’s been filling up on the cheap day for years.
Fuel watch will have the effect of reducing the peaks & troughs meaning an end to tight arse tuesday. Whilst fuel prices on average might go down. It’ll mean the cheaper days will be lost.
Effectively me and other “fuel savvy” types will be forced to subsidise those that do lots of complaining but continue to fill up on the peak days.
Call me pessimistic but I’m sure the governments are happy to keep the prices high - they in turn benefit from the taxes, just as they’re happy to keep pokies and smokes on sale as they get a massive cut from them too
Conquistador, exactly right.
Perth “average” price for May was 2 cpl than Adelaide, however every week petrol was available for considerably less than Perth, due to a discount cycle. Fuelwatch will COST every semi-intelligent (or better) motorist between 1 and 8 cpl every time they fill up. But KRudd will have been seen to DO something.
Fuel watch has been shown to be a bad idea and I hope it gets blocked by the Coalition majority in the senate (They still have majority correct?).
With that said there is nothing this or any government can do to reduce cost of oil based fuels in the long term, that must be done on the supply side of the equation.
OUR oil should be sold to us at a fair price NOT world parity price!
countries like Saudi Arabia, venezuela and many more oil exporting nations sell petrol to their citizens for between 20 to 60 cents a litre depending on the country….so why can’t we do the same with the 60% we produce!!! and the same goes for LPG and natural gas why do we import expensive LPG and sell OUR LPG so cheap to China and Japan???
Our politicians must want us to believe they are corrupt when they act like this?…..both sides of politics have done this!
John E
There is plenty they can do.
First & foremost how about breaking the oligopoly that exists at the wholesale level in australia. A bit of healthy competition never hurt anyone.
They could address the refining capacity bottleneck which is outside of the crude oil price the fundamental reason why retail fuel prices are through the roof.
How about a proper rail freight and city to city fast train network. thats better than having 100’s of smacked out of their eyeball B Double drivers bouncing off unsuspecting mazda 121’s isn’t it?