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Heavy Vehicle Charges Unchanged

Minister for Transport and Regional Services - Warren Truss
017aTRS/Budget 9 May 2006

The road user charge paid by road transport operators will remain unchanged this year, the Australian Government Minister for Transport and Regional Services, Warren Truss, announced tonight.

"I will shortly table in the Parliament a declaration setting the road user charge from 1 July 2006 at 19.633 cents per litre, the same rate as it is now.

"This follows my rejection in March of a recommendation by the National Transport Commission to lift the road user charge to 22.1 cents a litre," he said.

"As I said when I rejected the proposed increase, the Australian Government is particularly concerned that increases in road user charges at this time of high fuel charges would be very difficult for the industry.

"While everyone accepts that the industry must pay its way, road transport makes a significant contribution to the Australian economy and is already under significant pressure," Mr Truss said.

The road user charge is implemented through a rebate of 18.51 cents per litre (cpl) on the fuel excise paid by operators of transport vehicles over 4.5 tonnes GVM. Fuel excise was frozen in March 2001, and over the same period the Australian Government has not changed the fuel excise charged to the heavy vehicle industry.

Mr Truss said tonight's decision means that Australian Government's excise charges on the industry have not changed for the sixth year in a row.

"It represents direct savings to the industry at a time of high fuel costs, and costs the Australian Government a total of $1.23 billion over the full forward estimates.

"However State and Territory truck registration charges, the other part of heavy vehicle charges, have increased every year under a CPI-linked formula, and are likely to increase again this year by 2.7 per cent," he said.

"In the absence of off-setting linked expenditure by the States and Territories, I do not consider that there is a compelling case for a similar increase in the Australian Government's Federal Interstate Registration Scheme."

Mr Truss added that maintaining the road user charge at its present level would also allow transport operators to gain the maximum benefit from other changes to Australian Government road transport pricing to be introduced from July this year.

"These include the abolition of arbitrary boundaries applied to the on-road fuel excise rebates, and extension of the scheme to petrol-powered as well as diesel-powered vehicles. These changes will save the road transport industry a further $130 million a year," Mr Truss said.

The Australian Government will next consider the future of road user charges after the Productivity Commission has reported on the industry late this year.

NOTE: Under the Fuel Tax (2006) Bill now before Parliament, the Minister for Transport will be required to set the road user charge by parliamentary instrument. The declaration is a disallowable instrument.

Media contacts:
Mr Truss' office - Kylie Butler 02 6277 7680 / 0417 652 488