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Auckland’s new fuel tax

Written By: - Date published: 10:04 am, March 23rd, 2018 - 37 comments
Categories: auckland supercity, local government, phil goff, transport - Tags:

An additional tax upon Aucklanders designed to alleviate traffic congestion is on its way.

 

The move was welcomed by Auckland Mayor Phil Goff.

There is pretty strong support in the Auckland Council LTP consultation at the moment. LTP submissions show about half in favour. This is surprising and impressive.

The equivalent rates increase needed if there were no fuel tax would be an 8-9% rates increase on top of the general rates increase of 2.5% plus any other targeted rate.

It is intended that Auckland Council will be able to put this tax into effect from July 1st this year.

The big test will be: how elastic is this new cost on society?

Taxes on cigarettes have gone up and up in great leaps, with about $30 for a pack of 25 and about $70 for a bag of rollies, and yet the rate at which we are quitting is very slow.

Charges for water in Auckland are very carefully debated in Auckland Council in LTP rounds, but because water is something you can’t live without, they are not really priced to ensure that you consistently use a minimum. And yet, Aucklanders are increasingly water efficient as you can see in their gross per capita consumption, showing surprising elasticity.

How much less can Aucklanders use their cars as a result of this tax? The HOP card has only been in place for a few years, the public transport system is slightly better than it was at amalgamation, but it’s a spread-out and multi-centred city. Maybe the level of the tax will force efficiency from so many Aucklanders that it makes a difference. Maybe it’s not enough to really make that change.

A much higher tax on petrol and diesel – even a regionally targeted one – is a massive test for both Auckland and for this government. And it is a test for 1.7 million New Zealanders, many of whom vote.

37 comments on “Auckland’s new fuel tax ”

  1. You_Fool 1

    Glad I am making the switch to an EV really 🙂

    That said, we need the $$ to actually make things better, and I would welcome even a inner city congestion charge, at least once they have PT working efficiently… It is better than it was, but still more is needed.

  2. Brigid 2

    A fuel tax will make not the slightest difference to the congestion while the public transport system to the outer areas is so archaic, where new subdivisions are appearing over night.
    Goff is a complete dolt.

    • Johnr 2.1

      I don’t think the fuel tax is to reduce vehicles on the road, but to raise revenue for public transport, which will in turn reduce vehicles.

      However, I think we need a Penny Bright to ensure this money is only spent on transport rather than being lost in a big money bucket

  3. Pat 3

    As a funding mechanism for public transport its a no brainer but anyone hoping a max of 10cents a litre will have any impact on private vehicle use is delusional….fuel prices frequently fluctuate in that range month to month.

  4. Tricledrown 4

    Fuel taxes will have a double benefit increased spending on public transport plus make people think twice about travel.
    The price of fuel has been rising steadily.
    Tolling for peak hr congestion would also help with ride sharing discounts also.

  5. AB 5

    People who already have to watch their money will travel less.
    People who don’t (this includes every single person who gets to influence or make the decisions about such things) won’t.

  6. dukeofurl 6

    Cigarettes tax is not a good comparison. Its addictive for one, and very hard for smokers to break the habits of a lifetime.
    The high price and the anti-smoking campaign is best aimed at those who havent started and are early or occasional smokers

    Higher petrol prices about 5 years ago indicated a drop in traffic, so maybe a sign of some reduction in traffic volumes with a tax.

    The real reason for fuel tax is to raise money lets be honest.

  7. Dv 7

    10 cent per litre bring them up to wgtn prices

  8. adam 8

    Still think 10 cents is way to low.

    Should have been at least 25 cents a litre!!

  9. Tuppence Shrewsbury 9

    is the tax being invested into public transport only to two fold improve aucklands congestion? less cars & more public transport

    or is it punitive and just a way to punish aucklanders for their councils inability to control spending, a la phil goff thinking anyone cares what cabin class he flies in when he arrives overseas

  10. Bill 10

    ffs. Brilliant. Under a NZ Labour led government we have a regressive user pays tax being rolled out in a city with an ex NZ Labour mayor, that relatively speaking (we don’t know this!?) hammers the poor while barely touching the rich.

    • patricia bremner 10.1

      Goff was always hard right on the left. LOL If he could have driven down the middle he would have. However, if this money improves public transport… if.

    • AB 10.2

      Yep – I could abide regressive taxes if they were matched by progressive counterpoints elsewhere, e.g. making public transport free at the point of use is a progressive subsidy that proportionally benefits the poor more than the wealthy.
      But on their own, regressive taxes stink.

    • Pat 10.3

      If thats your take on a max 10c per litre tax to help fund public transport what do you think a transition to a carbon neutral economy will look like?

      Pump prices have varied by around 30c a litre over the past 12 months regardless.

      https://www.interest.co.nz/charts/commodities/oil-and-petrol

      • Bill 10.3.1

        The amount is kind of irrelevant – which is why I specifically included the term relative in my original comment.

        10c a litre? Buy more than $100 worth of groceries at New World or whatever amount at Pak ‘n Save. The 10c isn’t the issue.

        It’s the principle.

        I think a supposed transition to a carbon neutral economy will look exactly like how things are right now. Because I don’t think it’s going to happen.

        • Pat 10.3.1.1

          “I think a supposed transition to a carbon neutral economy will look exactly like how things are right now. Because I don’t think it’s going to happen.”

          Well i dont necessarily disagree with you on that point however any attempt (should it be made) is going to include taxes which by their nature will be regressive…hopefully those least able to afford will be assisted by transfers but obviously the transfers cannot be of such a nature as to undo the intent of the tax….whether thats the only way is not the point…its how it will be structured to a greater or lesser extent under the current system.

          • Bill 10.3.1.1.1

            If the tax route is taken, carbon emissions will stay on the rise. The rich, who are the high emitters, can absorb any kind of tax that falls short of killing the poor (yes, that’s a wee bit on the “hyperbole” side of things) and business will absorb by passing onto consumers.

            And just to yet again signpost Kevin Anderson’s calculation on tax which worked out at 5/8ths of sfa in terms of reduced carbon for a tax sitting at something like $300 – or was it more? I can’t remember.

            edit – James Shaw is all in favour of a regressive carbon tax. He sees no problem with business passing increased costs onto consumers. It’s (in his words) the intention – “what we want to do”

            • Pat 10.3.1.1.1.1

              yep I know your and Kevin Anderson’s point..and I think the figure was between one and two hundred from memory (if your referring to long haul flights)… taxes can only form part of the solution if there is to be one, but part they will be….along with standards and regulation…and worst case scenario, at the point of a gun if it all turns to crap.

              And no matter what method you use consumers will end up paying one way or another…..solution, dont consume.

              • Bill

                I don’t consume. Not in any meaningful measure in relation to AGW. And most of the world’s population don’t really consume either.

                The solution lies in taking down the richer of humanity’s population – the 5-10% who gift us about 50% of our total emissions and the 40% who gift us another 40% of our emissions.

                That’s 90% of our emissions dealt with right there.

                But short of taking their economic legs out from under them by destroying capitalism, I can’t see how that bastard half of humanity gets made to toe the line.

                So yeah. I can see it all coming down to the “point of a gun” keeping us in line while the bastard half spews it’s way to a pretty fucked up end.

                • Pat

                  pretty much….except even that overwhelming majority of non or low emitters rely on the supply chain run and owned by that small percentage for their continued existence…its a dilemma to be sure.

                  • Bill

                    Hmm. I look at it differently. It’s the smaller percentage who rely on us to lubricate that supply chain.

                    No dilemma. We stop and the chain stops.

                    We’d call it freedom.

                    • Pat

                      Yes we are free to make that choice…Id submit that the coordination and commonality of purpose required to achieve it is impossible(remembering it is time constrained)….perhaps not on a small scale but certainly on the scale required.

    • mikes 10.4

      Yep, although it’s a consumption tax rather than user pays. Regardless, it will affect the poor and those on low incomes the most, just another smack in the face for them from fuckwit politicians. Those on middle and upper incomes won’t even notice it.

    • Molly 10.5

      Agree.

      Given the inequality of Auckland, the failure of Auckland Transport to provide decent, affordable, comprehensive public transport to the outlying areas, South Auckland being one area I know of, this is a punitive tax on the already struggling and most financially vulnerable.

      And why? Because successive council representatives have failed to both identify and concentrate on the fundamental services that local government should supply. The fragmented nature of council departments ensures that the wider picture is not looked at. The whole of the ATEED spending should be eliminated until the housing crisis is sorted, the infrastructure is improved, and the other services of council such as libraries, parks and reserves, and community facilities have been listed and improved.

      Council has the regulatory ability to encourage low energy use in buildings and design, and enforce it. They also have the ability to lobby central government to reinstate Auckland Transport as part of Auckland Council, and improve planning outcomes. They need to do their job, and stop ratcheting up the income stream because of successive failures.

      The levy on regional fuel, was because the National government was not going to willingly fund a comprehensive public transport system, or alternative transport in Auckland. They’ve gone. Auckland Council should lobby the new coalition government, and Auckland Transport should cancel or postpone some roading projects to get the funding.

      If the current government came out and reviewed the previous stance, and decided to put their money where they pre-election promises led, they would not only indicate a change in focus in terms of climate change, they would alleviate some of the imposed poverty on many families, and be a welcome break for many Aucklanders.

  11. timeforacupoftea 11

    Excellent.
    The other good bit about these Taxes on cigarettes and 10 cents tax on fuel.
    It all causes inflation and we make up for it through wage increases.

    So thanks Auckland us not living in Auckland area will get a slightly better advantage from your fuel tax from your silly Mayor Gough in the form of a wage increase.
    GO LABOUR.

    • Draco T Bastard 11.1

      So thanks Auckland us not living in Auckland area will get a slightly better advantage from your fuel tax from your silly Mayor Gough in the form of a wage increase.

      Auckland is already subsidising you. In fact, it’s probably those subsidies that forces us to require the fuel tax.

  12. eco maori 12

    Many thanks to Labour lead coalition government for starting the tax on fuel.
    This is the way the Papatuanukue te World has to be to leave behind a bright prousperious positive future for all OUR mokos. This fuel tax will affect all people all business to not just the poor yes the poor will not be able to travel as much but this is the price we have to pay to change our society from a carbon dependent society to one on renewable energy Ka pai Phil Goff for getting this tax into the public domain for debateing. And now its going to be Law. Ka kite ano

  13. Draco T Bastard 13

    I’d be happier with a congestion charge if they also had businesses paying directly for the transport of their workers to and from their place of business.

    That way the congestion charge would fall upon those who are responsible for it.

    Would see a major change in focus from cars to PT if we did that.

    • Monty 13.1

      That is a much better idea.

      Also be good to see if they could make commercial vehicles move at non peak times or have significant increased congestion toll.

      Promote change with a reduced congestion toll for EV vehicles.

  14. Herodotus 14

    Our local assortment of councillors need to own up and front up. We are being told that AC needs more $$ yet they are now wanting to under fund aspects that IMO is essential local government responsibility.
    http://www.scoop.co.nz/stories/AK1803/S00570/aucklanders-urged-to-have-their-say-on-sport-and-recreation.htm
    “Council itself has said that at this nominated baseline level, there will be a decreased level of service, deteriorating assets, and risk of failure and asset closure.”
    So we are funding at a level that will FAIL !!!
    This is not leadership.

    • Draco T Bastard 14.1

      So we are funding at a level that will FAIL !!!

      That’s been happening to all government services and infrastructure since the 1980s and the Rogernomics revolution that put rich people before the rest of the population and pretty much everything else.

  15. Lurker 15

    Fuel taxes are a double whammy for the poorest people, without achieving much except raising more money for the council to waste on pet projects.

    Poor people now need to pay more to get to work, doctor, school, shopping etc, while inflation on the basics items that they have to buy to survive will rise the most.

    • Molly 15.1

      You are right, which is why I submitted against this proposal. It is presented as the only option for improvement, which is why I dislike this kind of directed consultation.

      This kind of limited options is replicated in the targeted rates for kauri dieback disease.

      There is no mention of reducing spends in other areas – ATEED etc. Which would be the first port of call for Budgeting Services.

      If – like me – you are frustrated at this elevated view of a regional fuel tax being a marginal cost – then have your say by going online to their survey, and change the uptake from 50% to less.

  16. cleangreen 16

    I lived in Toronto for three decades of this “to and fro-ing” until they figured out they couldn’t get ahead of the curve ball taxing motorists.

    So they invented three types of public land transport, Tube rail, – fast commuter suburban rail and city trams, all transferable. so why didn’t Auckland do this many years ago since the 1950 when Sir Robbie Dove Myer Robinson suggest something like this’s????
    http://www.cityraillink.co.nz/rapid-rail-vs-motorways

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