NZ road user charges, petrol excise to rise

NZ road user charges, petrol excise to rise in vehicle licensing rejig

By Paul McBeth

June 12 (BusinessDesk) - New Zealand's road user charges and petrol excise will rise from August in a vehicle licensing rejig, and will help pay for national transport projects.

The road user charge will rise by 4.1 percent and petrol excise by 2 cents per litre from Aug. 1, while at the same time dropping supplementary licences for heavy vehicles, removing the time licence system, changing existing exemptions, and cutting the administration fee for a licence, Transport Minister Gerry Brownlee said in a statement.

"This increase is effectively a catch-up to ensure there continues to be sufficient revenue available to meet the government’s land transport expenditure targets," Brownlee said. "The funds raised will contribute to the annual $1 billion investment in developing the country’s state highway infrastructure."

The government will reap $1.04 billion from road user charges, $885 million from domestically produced petrol excise and $602 million from imported petrol excise, according to the Treasury's latest forecast. That's forecast to rise to $1.4 billion in road user charges, $1.04 billion in domestically produced petrol excise, and $694 million from imported petrol excise by 2016.

The government plans to spend $6.5 billion on new roads as part of its nationwide infrastructure strategy, having identified seven roads of national importance when it came to power in 2008.

In 2010/11, some 36 percent of the $2.65 billion National Land Transport Fund was spent on new and improved State highways, 23 percent on local road construction and maintenance, 18 percent on maintaining State highways, 10 percent on policing, 9 percent on public transport, and 4 percent on other transport activities.

A 1.5 cent per litre hike in petrol excise was set down form July last year, though the government delayed that increase due to the slow economic recovery from the global financial crisis and the Canterbury earthquakes.

(BusinessDesk)

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