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Home / Business / Personal Finance / Tax

Trucking tax 'to be passed on to public'

30 Mar, 2007 12:00 AM2 mins to read

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KEY POINTS:

Trucking companies are angry that they were given only 48 hours' notice of a sharp rise in road user charges and say consumers will end up paying.

Transport Safety Minister Harry Duynhoven announced yesterday that road user charges for vehicles over six tonnes would increase an average 11 per cent from April 1.

He said there had been no increase since 1989, whereas charges for vehicles under six tonnes had almost doubled in the same period.

The Road Transport Forum, the lobby group for trucking companies, said that charges had never been increased at such short notice before and its members would not be able to adjust their contracts quickly enough to recover them by the start date.

"The road user charges increase may be justified, but the extremely brief lead in time is totally unacceptable," said forum chief executive Tony Friedlander.

He added: "But in the end it will be all businesses and consumers who will have to pay. Everyone deserves a full explanation from Government."

The Government was showing a casual indifference to the financial viability of transport businesses across the country at a time when the industry was struggling with falling margins and profits, he said.

Mr Duynhoven said road user charges are set according to vehicle type and weights and were intended to reflect the direct cost of vehicles using roads.

Up until now, road user charges for vehicles over six tonnes had covered the costs these were collected for.

"However, with major increases in land transport funding and in the cost of road building and maintenance, road user charges for vehicles over six tonnes need to increase," he said.

Vehicles over six tonnes caused a disproportionate amount of wear and tear to roads, the Government said.

The actual increases to the charges would depend on an individual vehicle's weight and axle configuration.

All diesel vehicles and vehicles over 3.5 tonnes incur road user charges. Drivers of petrol vehicles pay a similar charge as part of the price of petrol at the pump.

The charge increase comes as the Government negotiates future access fees with the main railfreight operator Toll NZ. The fees are designed to recover the cost of maintaining the rail network.

- NZPA

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