Increasing fuel costs have been a source of frustration for Australian drivers, prompting concerns nationwide. Opposition Leader Peter Dutton has suggested that the Coalition might be willing to support a temporary decrease in the fuel excise in response to this escalating problem. Such a move could relieve motorists grappling with rising petrol prices.
The fuel excise is a tax imposed by the federal government on petrol and diesel purchases at fuel stations. Currently, for every litre of fuel purchased, motorists pay 48.8 cents in excise. This tax revenue plays a crucial role in funding essential infrastructure and services across the country. However, with petrol prices continuing to rise, there is a pressing need to explore ways to ease the financial burden on everyday Australians.
In a departure from the Coalition’s usual commitment to fiscal responsibility, Mr Dutton acknowledged that there is potential for short-term relief through a reduction in the excise, despite recognizing its associated costs. He emphasised that there are situations where a decrease in the excise can be effective.
According to analysis from the Australian Institute of Petroleum, unleaded petrol prices have remained consistently around $2 per litre for several weeks. Recent inflation data, released on Wednesday and exceeding economists’ predictions, indicated a 7.2% increase in fuel prices during the September quarter.
The growing public pressure has called on the government to consider reducing the fuel excise, but the government has thus far rejected the idea of providing temporary relief. Treasurer Jim Chalmers stated on Wednesday, “We will consider measures that align with our strict fiscal discipline, but this is not currently a part of our agenda.”
In September of the previous year, the Albanese administration allowed a 22-cent reduction in petrol excise to expire, citing concerns that an extension would impose an estimated $3 billion cost on the federal budget within just six months.
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