Transport Minister David Parker defends fuel tax increase, says there's 'no difference' with National's plan

  • 18/08/2023

Transport Minister David Parker has defended the Government’s petrol tax proposal, claiming the National Party will do the same thing.

It comes after the Government unveiled its plan to increase fuel taxes by four cents per litre every year for the coming three years to help pay for improvements to New Zealand's transport network. 

Each four-cent per litre increase is equivalent to an additional cost per week of 88 cents for the average motorist, according to the Government. By July 2026, when the full 12-cent increase has come in, the additional cost will be $2.64 per week.

These figures were based on the average driver who used 25 litres of fuel a week, Parker said.

But Ryan Bridge said the additional cost to drivers could be higher for a lot of people.

"If you are a mother of four who has got to drop kids off at ballet and soccer and school and then go to work part-time…" Ryan said.

"You know, Ryan, how would you pay for it [the transport improvements]?" Parker interrupted. 

"This is a record investment in transport - we need it. I think most New Zealanders know you just can't magic the money."

Bridge hit back, asking the minister where average Kiwis are going to find the money to pay for this increase.

"Where are people going to find this money?" he said.

Bridge said the National Party has planned to use private investment, value capture and cost recovery to pay for its transport plan.

"The point is, under their plan, they are not going to put the price of petrol up," he said.

But Parker claimed National is planning to increase petrol when inflation comes back down which is scheduled to happen at the same time Labour's fuel tax would come into effect. He also pointed out road users will have to pay if private investment is used.

"There's no difference," he said. 

The National Party has not committed to increasing petrol taxes, saying it will be considered it at a later date.

Nicola Willis, National's finance spokesperson, on Thursday promised her party wouldn't consider increasing the fuel excise duty (FED) until the annual inflation rate fell back below 3 percent. She suggested it will take longer under a Labour Government for inflation to get back to the target range.

"What I am saying is that at the point inflation is under control and the cost of living crisis is behind us, we will then assess whether any modest increases are needed to fund land transport costs," Willis said.