Henry supports direct charging, ATA still opposed

Treasury boss says industry won't mind paying congestion tax, but ATA says systems too expensive

By Jason Whittaker | October 16, 2009

Trucking operators will support a direct road pricing model including congestion charging if the revenue is invested in the road network, Treasury Secretary Ken Henry claims.

But the trucking lobby remains highly cynical about Henry’s motives for a shake-up in truck taxes, concerned the technology systems tied to it will cost operators significantly.

In a speech in Brisbane yesterday, Henry appeared to offer support for congestion pricing and the GPS-based mass/distance charging model for heavy vehicles advocated by governments.

Henry is due to deliver a landmark review into the tax system in December.

He says the new road pricing model is in fitting with "innovative ways of dealing with the community’s distributional concerns".

"For example, some truck operators might support road pricing as long as the costs they pay are reflected in better roads – their compensation is a better functioning road network," the Treasury boss says.

"They would also like assurance that the compliance costs of road pricing will be low and remain low."

It is that issue that most worries the trucking industry, which has rejected moves already agreed by the federal and state governments to roll out mandatory truck tracking to price road access based on distance and payload.

Bill McKinley from the Australian Trucking Association (ATA) says the Henry review is "grasping for technological solutions for a problem that doesn’t actually require one".

McKinley says the mass/distance charging model would be "incredibly expensive" for the trucking industry. Some of the systems advocated come with a "frightening" cost, he says.

The ATA is pushing its own plan for a replacement to the current road pricing system, which averages costs across the fleet and charges them back through registration fees and excise on diesel fuel.

It wants a system based on fuel use alone, which would significantly increase the diesel excise while reducing registration charges.

McKinley says the ATA has submitted its plan to the Henry review and recently briefed Treasury staff for two and a half hours on the proposal.

Henry said yesterday politicians need vision to radically reform tax frameworks for the future, highlighting congestion charging schemes like the one in London as an example of what Australia must examine.

"Reforms like road pricing will be difficult, but these overseas examples show that it is possible," he says.

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