Fired up over funding shortfall
A shortfall in transport funding should be made up with GST from petrol, says Chamber of Commerce head and Auckland Regional Council deputy chairman Michael Barnett.
Mr Barnett says the government has received a windfall of extra tax revenue from increasing petrol prices.
“A strong case exists for the government diverting this or equivalent revenue back to Auckland to mitigate for the delayed regional fuel tax,” he says.
But Campaign for Better Transport spokesman Cameron Pitches disputes whether the government benefits from higher fuel prices.
“I don’t believe tax would be increasing by that much because people would be using less petrol. People are under a misconception the government is getting more money.”
A treasury report released in 2005 by Finance Minister Michael Cullen says petrol price hikes lead to little change in tax revenue.
In the long term, revenue can drop because people use less petrol and spend less on other goods.
Mr Barnett says his calculations allowed for a drop in fuel consumption.
“There’s been some fluctuations in volume but there’s still been a significant gain by government.”