The National Road Transport Association (NatRoad) has called for the Coalition’s plan to halve the fuel excise to include the road freight sector.
NatRoad says the Coalition must protect Fuel Tax Credits (FTCs) in its proposal to lower fuel excise for 12 months, with CEO Warren Clark saying FTCs must remain during any temporary reduction to the fuel excise so that the benefits are felt by all road users.
“Under the former Coalition government, the decision to halve fuel excise also meant the suspension of Fuel Tax Credits.
This wiped out the benefits of the tax cut, throwing cashflow for small road freight businesses into crisis,” Clark says.
“We welcomed the restoration of Fuel Tax Credits under Labor back in 2022. The Coalition must now commit to protecting Fuel Tax Credits in full.”
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Clark says the road freight industry is under significant cost pressure and can’t afford another hit to Fuel Tax Credits.
“Diesel, maintenance, vehicles and wages all continue to climb while major transport customers continue to push for lower freight rates,” he says.
“About 98 per cent of the road freight industry consists of small businesses. Average profit margins are just two per cent.
“Small trucking businesses lack the economic bargaining power to simply pass on higher costs. Fuel Tax Credits have a heavy impact on cashflow management.
“Unless Fuel Tax Credits are protected for the duration of the policy, the benefits of lower excise will not flow on to small trucking businesses. Instead, many in the industry that keeps Australia’s shelves supplied could face financial ruin.”
The current Fuel Tax Credit rate for heavy vehicles on public roads is 20.3 cents per litre (until 30 June 2025). NatRoad says a 25.4 cents per litre reduction in fuel excise will result in a reduction of just 5.1 cents per litre for heavy vehicles (alongside the suspension of Fuel Tax Credits).