Regional fuel tax on hold for Hamilton

A regional fuel tax is on hold for Hamilton after central government said no, but councilors are not backing down. Photo / File

Central government has said no to a fuel tax for Hamilton, but the city council is going to restate its case and ask it to reconsider.

The council had included a proposed regional fuel tax in its 10-year plan to try to cut the second of two proposed 9.5-per cent rate rises over two years. The council wants an 11.5c a litre fuel tax to fund transport projects in its10-year plan.

At the first council meeting of the year, mayor Andrew King reported that Finance Minister Grant Robertson knocked back the fuel tax request.

"The Government has said no — they want to hold that for Auckland only. I accept that. Obviously I am disappointed but they are quite firm on their position," Mr King said.

However, councillor Dave Macpherson said he saw the answer as an opportunity to continue to push for a fuel tax.

"I think there is a very good purpose served by us putting the case for a fuel tax, principally because the amount to be collected in a fuel tax is approximately equal to our annual transport improvement budget," Mr Macpherson said.

Without the improvements, "gridlock will descend on our city, it already has," he said.

Mr Macpherson said Hamilton was the second fastest growing city in the country and needed the transport improvement budget over other cities.

"We did not see this as a nice-to-have, we saw it as an essential to get some outside revenue to support that."

Deputy mayor Martin Gallagher supported Mr Macpherson's push to go back to central government.

"The beauty, of course, of a fuel tax is our lovely visitors from Tamahere will get to pay," Mr Gallagher said. "Other people who come to Hamilton use a lot of our infrastructure so this is a good way and I support that."

Councillor Rob Pascoe also backed Mr Macpherson's motion.

"Are we just going to sit there and take that as a final answer? That there's no fuel tax for Hamilton?"

The council voted 10-2 that the council requests the CEO to develop the case for a fuel tax to support Hamilton's transport improvements budget and the steps necessary to promote it.

Councillors Paula Southgate and Angela O'Leary voted against the motion.