Motorists deserve a fair-go on fuel excise expenditure

From excise to infrastructure

The AAA with RACV is urging the government to reinvest at least half of the more than $12 billion raised in fuel excise into a dedicated transport infrastructure fund to address the nation’s worsening road safety, affordability and congestion issues.   

On behalf of our members, we want at least half of all fuel tax invested into roads and public transport. The current transport system’s failure to keep up with growing demand is harming our economy and our quality of life. Every year, congestion increases, the nation’s infrastructure backlog grows, transport costs rise, and governments miss important road safety targets.

Australia urgently needs well-planned and comprehensive policy action to reduce congestion, curb the road toll and renew its land transport system. 

Our research has found that members are concerned by the multitude of fees and charges that impact motorists, including federal fuel excise, GST and the state-based charges such as registration and stamp duty. With 86 per cent of our members agreeing that Governments should invest more in our road system, it’s concerning that less than one-half of the existing revenue from fuel excise is currently spent on transport projects. 

However, it can’t stop there. We need an overhaul of the current system of taxes and charges for using roads.

Charging ahead

A more equitable and sustainable system of charging for road use will need to be found and the planning for what is needed must start now. Many countries around the world are implementing systems of charging for road use like the way we are charged for gas, electricity and water. These systems have an access charge and a usage charge based on consumption. Charges would consider the type of vehicle being used, the location, distance and times of travel.

RACV believes this system needs to replace the current system, not be an additional charge to current costs. A critical part of any new charging system is that all the revenue from the user charge would be reinvested in road and public transport improvements. There should be a clear link between the taxes paid by motorists and government investment in transport infrastructure.

RACV is calling on both parties to conduct a public inquiry into the problems with the existing funding system, alternative models and its likely effect on motorists. The current system relying on fuel excise, GST and various Federal and State motoring taxes is complex and broken and should be replaced with a fairer, more equitable system. Road user charging that considers how, when and where we travel is more sustainable and fairer for Australians.

It is clearly time for governments to engage with the community on ways to develop a fairer and more equitable system of charging to use our transport networks.

RACV advocacy projects aim to make Victoria more liveable

Authorised by Bryce Prosser, RACV General Manager Public Policy and Corporate Affairs, 485 Bourke Street, Melbourne, Victoria, 3000