EV dealers hoping fuel price rises will drive more EV interest may have to wait a while longer with the 25 cents a litre petrol excise duty cut extended to June 30, 2023.
The road user charge discount will be re-introduced and half price public transport fares continue through until June 30 as well.
From July 1, half price public transport fares become permanent to about a million Community Service Card holders, including tertiary students.
The announcement was delivered in Auckland during a visit to flood-hit areas by prime minister Chris Hipkins, Auckland minister Michael Wood and finance minister Grant Robertson.
“I’ve said bread and butter issues like the cost of living would be my top priority,” says Hipkins.
“This is our first step in dealing with some of the persistent cost pressures on businesses and families.
“Reducing the cost of fuel excise and public transport is a good candidate for early action – it’s a major cost for nearly everyone, we know how to do it, and can roll it out quickly.”
Hipkins says transport is the third biggest expense on households after housing and food.
“The floods in Auckland and Northland are putting extra stress and financial pressure on families. Cutting fuel excise and keeping half price public transport gives some extra relief as Auckland goes through a difficult period,” he explains.
Robertson adds that with economists forecasting New Zealand’s inflation to remain at elevated levels for longer the Government has decided to revisit its decision on the transport support package.
“We know that increases in the price of food is hitting families hard,” he says.
“A significant component of those costs come from fuel. Extending the cut to fuel excise and road user charges will have a meaningful impact through reducing these costs.
“It is also a good policy for business. The cost of freight and running car fleets is a big cost for many businesses, so this extension helps relieve a bit of pressure on those doing it tough right now.
“The cut to fuel excise reduces the cost of filling up a 40-litre tank of petrol by around $11.50, and for a 60-litre tank, around $17.25 and half price public transport will save an average person who pays two $5 fares a day $25 a week.
“The extension of all measures is estimated to cost about $718 million,” says Robertson.
“We are paying for the extension from savings identified in the most recent baseline update.
“This extension takes us to the end of the financial year. We have already indicated that the Budget will have a cost-of-living focus, and this extension covers the time until that comes into force”
Wood says supporting people onto affordable public transport helps to take pressure off roads and is good for the climate.
