Transport alliance calls for Chalmers to reinstate fuel tax credit

A transport industry alliance is calling on the Albanese government to restore the fuel tax credits (FTC) scheme that was shelved by the Coalition in the last federal budget.

In a joint letter to Treasurer Dr Jim Chalmers, the Transport Workers Union (TWU), Australian Road Transport Industrial Organisation (ARTIO), National Road Freighters Association (NRFA) and NatRoad (National Road Transport Association) say that rising operating costs are already impacting the sustainability of road transport.

NatRoad CEO Warren Clark said operator’s balance sheets since March have slipped further and further into the red.

“Reversing this trend will take national leadership to support the industry through sky-high fuel costs,” said Clark.

“The new federal government can’t delay restoring fuel tax credits or more operators will be forced to park up their trucks.”

NRFA president Rod Hannifey agreed that road transport is at breaking point.

“Drivers and operators can’t keep footing the bill for rising fuel costs,” said Hannifey.

“Not all can easily pass these costs on and it simply adds to the cost of living across Australia. It’s unsustainable and supply chains will soon grind to a halt if this new federal government doesn’t step in.”

TWU national secretary Michael Kaine said former prime minister Scott Morrison and his treasurer Josh Frydenberg sold the industry a lemon when they promised fuel relief.

“This prime minister and treasurer shouldn’t do the same. Until we have in place regulation to ensure effective cost recovery from wealthy retailers, manufacturers and oil companies at the top of the chain, we’re calling on the federal government to restore the fuel tax credits system to ease the financial burden on drivers and operators across the country,” added Kaine.

Prior to the last federal budget, the road user charge (RUC) was set at 26.4 cents per litre. This was comprised of the full excise rate of 44.2 cents per litre minus a FTC of 17.8 cents per litre which heavy vehicle operators received when submitting their monthly or quarterly business activity statement (BAS).

As a result of the halving of fuel excise on budget night, heavy vehicles effectively faced a reduced RUC of 22.1 cents per litre of fuel (as opposed to 26.4 cents).

The government at the time told the industry it was still on the right side of the ledger, given there was  now a net benefit of 4.3 cents per litre.

But as industry critics such as Steve Shearer, executive director of the South Australia Road Transport Association, pointed out, many operators are expected to pass on the fuel savings to clients, and also lost out on the usual cash flow they had relied on when filing their BAS.

“The point they’re missing is that most of the industry does not have bargaining power. Their customers see fuel prices drop by 22 cents, or at least an announcement of that reduction, and therefore they expect to see that reflected in a reduction in the rate,” Shearer told Big Rigs last month.

“So, you pass on the full 22 cent fuel excise cut to the customer, and very few truck operators have managed to negotiate their way past that and offset the loss of the 17.8 cents [FTC].”

Labor Senator Glenn Sterle told attendees at the annual NRFA conference on July 9 that he’d had assurances from Chalmers that the FTC could be reinstated from the end of September.

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