The Road Transport Forum (RTF) is urging the Government to put off its increase in road user charges (RUCs) scheduled for July 1.
It echoes the National Party’s call to pause the planned increase which matches a fuel tax rise of 3.5c a litre and around 4c including GST.
The RTF wrote to transport minister Phil Twyford on March 19 asking for the Government to put a hold on the policy due to the impacts of COVID-19.
The RTF says its request was rejected but is calling on the Government “to reconsider that decision”.
“The RTF request was at the start of when businesses were seeing the economic impacts of COVID-19 and we pointed out there was a strong case for cancelling the RUC increases due to the economic headwinds, for both trucking companies and their customers,” RTF chief executive Nick Leggett says.
“Things are even worse than we imagined and not only is our economy in serious trouble, many New Zealanders are now unemployed and cannot cope with an increasing cost of living.
“Increased costs for moving goods mean increased costs all down the line at a time when many businesses and either struggling for survival, or are terminal. Everything comes on the back of a truck at some point, so that will mean prices going up everywhere, including essentials such as food.
“RUC for many heavy vehicles over-recovers the roading costs it is tagged to pay for. Government spending on works that relate to road wear and tear caused by heavy vehicles is less than the growth in revenue generated from those vehicles. They are taking more, but spending less.
“Experience from the 2008 economic downturn indicates road wear is likely to decrease, due to lower traffic volumes. But trucks will still need to travel the distances they always travel to ensure the flow of goods, so they will keep paying regardless.
“In his response, Minister Twyford advised the Government had many ways of giving substantial and direct assistance to businesses and workers affected by Covid-19. However, he said pausing the RUC increase would not only reduce the NLTF revenue at the very time we need to be investing in transport infrastructure, and when revenue is taking a hit because of falling vehicle kilometres travelled, it would also create disparity between RUC and fuel excise duty which has already had its increase legislated.
“We think that is not good enough. We don’t believe one tax should be increased just because another one has been. We think New Zealanders can’t face any more increases in the prices of essential goods at this time and businesses also cannot sustain increased costs when they are doing everything to keep people employed,” Leggett says.
Former National Party leader Simon Bridges says the Government should “give motorists a break rather than hitting them in the back pocket”.
“The Government introduced three years of annual tax increases to pay for its beleaguered Auckland light rail pet project that has gone absolutely nowhere since Jacinda Ardern promised it on the 2017 campaign trail.
“Kiwi motorists have already suffered enough under this Government. The tax hikes it has passed into law amount to a $1.7 billion tax grab, with Aucklanders the hardest hit because of their regional fuel tax,” Bridges says.
Transport minister Phil Twyford says the light rail project was about to go to Cabinet when COVID-19 hit.
“While the Government has been totally focused on fighting the virus and didn’t have the bandwidth earlier to consider the light rail proposal, it is going to Cabinet shortly.
“Our Government has already announced we will not be raising fuel tax next term, but Simon Bridges is advocating cutting it now at the very time we need to invest in transport infrastructure to boost jobs and help the economy recover.
“Cutting this year’s 3.5 cent-a-litre increase would mean massive cuts to roading and public transport projects throughout the country.
“New Zealanders understand their petrol taxes pay for roads and public transport. They want the Government to get on with fixing their neglected roads, easing congestion and building a modern and sustainable transport network,” Twyford says.
