Fuel prices will rise with the petrol excise increased.
Fuel prices will rise with the petrol excise increased. Kevin Farmer

Budget will see drivers slugged more at the pump

AUSTRALIA'S peak national motoring body has taken a swipe at the federal budget. 

The biggest hit for drivers is a hike in fuel excise. That excise is currently 38.1 cents a litre but as part of the new budget will rise in line with inflation twice a year.

The excise has been locked at 38.1 cents a litre since the Coalition dumped indexation in 2001.

Expect the excise to add about one cent a litre each year.

"Motoring clubs will fight for a better deal for motorists and seek a guaranteed and stronger share of tax revenue directed to infrastructure," Australian Automotive Association chief executive Andrew McKellar said.

"While there is a significant investment in roads and infrastructure in this budget, and the government has opened the door to having a direct link between motoring taxes and road funding, it falls well short of what motorists want..

"It is totally inadequate at that out of the 38 cents per litre that motorists currently pay in tax the Government has only committed that one cent will be guaranteed to go to future road funding.

"Motorists already pay a significant amount of tax and have not been getting fair value for their money."

The AAA said motorists want a guaranteed share of fuel excise returned to transport funding in order to stop the budget
"drip-feed" of investment and have called for a fair proportion of the fuel tax revenue to be dedicated to transport infrastructure to ensure Australia can ease worsening congestion in cities and improve the safety of rural highways.


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