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Heavy vehicle charges to increase 2.5 per cent

HV charges

Now is the time to have your say on proposed increases to heavy vehicle charges later this year.

The charge freeze is due to end on June 30, and you have until March 12 to argue your case to the National Transport Commission.

In support of your responses to the proposed increase in 2021-22, the NTC is interested in any evidence which you can provide about the following issues:

  • Which costs are typically passed through to customers (and to end consumers) and which costs are absorbed by vehicle owners or operators?
  • Is the pump price of fuel a cost that is charged separately under typical hire-and-reward contracts (such that fuel price fluctuations do not impact profit margins)?
  • Does the answer depend on the size of the business and their contract bargaining power?

“Any information provided on these questions will help inform the Ministers about the broader context in which their final decision on heavy vehicle charges will be made,” said the NTC’s Heavy Vehicle Charges Consultation Report.

The proposal by the Infrastructure and Transport Ministers Meeting (ITMM) last month was that a 2.5 per cent increase be applied to the roads component of registration charges in 2021-22.

This will increase the road user charge (RUC) to 26.4 cents per litre on July 1.

“It represents a small increase to close some of the gap between the cost base and charges revenue,” said the report.

Under the proposed registration changes, for a 6-axle articulated truck that would mean an increase of $144 a year on the current charge of $6225.

The cost for a 9-axle B-double would jump by $343 to $15,102, with a double road train incurring the same spike to $15,158, up from the current charge of $14,815.

The report said the regulatory component of registration charges will be set on a cost recovery basis, with minimal charges expected.

This means that the overall increase in total rego charges, including regulatory and roads components, is expected to be slightly below 2.5 per cent.

The NTC estimates that to ensure governments recover the amount spent on providing roads to heavy vehicles in 2019–20, current heavy vehicle charges would need to rise by 13.4 per cent for 2021–22.

If no decision is taken by ITMM, heavy vehicle charges would be automatically increased by 13.4 per cent for 2021–22 under the annual adjustment formula contained in the Heavy Vehicle Charges Model Law.

In May 2020, the Transport and Infrastructure Council (the predecessor of ITMM) resolved that charges be frozen for 2020-21.

The Council took this decision considering the extraordinary contraction in economic activity and income expected for the June quarter of that year. By freezing charges, the Council expressed its support for the operators of heavy vehicles, many of whom are small businesses.

The Council noted that some were working hard under tight margins to keep essential goods moving during the COVID-19 pandemic, while others were experiencing a severe downturn in work.

Following the conclusion of the public consultation process and any comments received, the NTC will provide advice on the proposed increases to ITMM and the Deputy Prime Minister as Minister for Infrastructure, Transport and Regional Development, Michael McCormack.

Submissions can be made online at ntc.gov.au or by mail to the below address:

National Transport Commission
Public submission – Heavy vehicle charges consultation report
Level 3, 600 Bourke Street
Melbourne VIC 3000

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