Tax invasion!

THE RACV has renewed its call for a reduction in the excise on petrol to help partially alleviate skyrocketing petrol prices.

With this week’s Budget expected to offer little in the way of relief for motorists, the RACV government relations manager David Cumming said the time was again right to look at the entire pricing strategy of petrol.

Excise on petrol and diesel is currently 38.14 cents a litre and 23.0 cents a litre on LPG. On top of that is a 10 per cent GST paid at the pump, effectively creating a double tax, according to Mr Cumming.

He added that such was the confusion of the excise issue in Victoria that it was actually 37.7 cents a litre across the state.

"Currently before the Parliament there are a number of reform Bills in relation to diesel rebates," he said. "Trucks pay a road user charge of 22 cents a litre – there’s very valid argument as to why motorists pay 37.7 cents a litre.

"Only six cents out of the 37.7 cents is returned to roads, so if they’re going to continue down that path then 10 to 12 cents easily would be an amount you would want to get off.

"If they’re only going to put six cents back into roads and the rest goes into consolidated revenue then they don’t deserve it." The RACV advocates that there should only be a GST on the wholesale petrol price. It also believes fuel excise should be replaced by a road user charge that would pay for road construction, maintenance and environmental costs.

Mr Cumming (left) believes the GST on petrol, which constitutes a "tax on a tax", has been poorly thought through and poorly implemented.

"We’re not going to resile from our position of trying to get rid of the tax on a tax and of course attempt to, maybe down the track, get some excise off," he said.

He said his consistent lobbying in Canberra over the issue had fallen on deaf ears. "Such is Treasury’s desire to get as much money as they possibly can out of the motorists, that they don’t like to give it up." He said it was the Federal Government’s view that if excise was taken off, it could never be put back on again. "The punters are definitely not happy." Mr Cumming also said that while petrol prices were hurting every motorist, pensioners in particular were being hit hard and the psychological impact of paying $100 to fill the average six-cylinder family car was huge.

As a representative of the thousands of RACV members, Mr Cumming has been strident in his condemnation of petrol taxes.

"The tax on the tax in particular is quite abhorrent – that’s our number one aim," he said. However, he said getting a break with excise remained a futile demand.

His strong advocacy on behalf of motorists has often got him into hot water with the government.

Last year the RACV banned him from speaking publicly on tolls and speed cameras, restricting his comments to fuel prices.

His comments about tolls and speed cameras had infuriated the Bracks Labor Government in Victoria.

The RACV believes the state and federal governments have failed to deliver any meaningful fuel tax reform to benefit motorists.

It is an issue Mr Cumming believes voters will react against at election time.