Tax rise to hit LPG drivers

Taxi driver Rod Maxted will be forking out more for gas after a new government tax raised the price by 2.5 cents a litre.
Taxi driver Rod Maxted will be forking out more for gas after a new government tax raised the price by 2.5 cents a litre. Scottie Simmonds

BUNDABERG region motorists who fuel their vehicles with LPG have been hit with a price rise from Thursday due to a Federal Government tax.

Service station operators can add the tax of 2.5 cents a litre once they receive a new delivery of LPG from a manufacturer or bulk supplier.

From July 1 next year the tax will go to five cents a litre, and then increase by 2.5 cents a litre a year until a maximum 12.5 cents a litre on July 1, 2015.

RACQ executive manager technical and safety policy Steve Spalding said motorists who used LPG could expect to pay an extra $2 when filling a 75-litre tank.

"Over a year, it could mean hundreds of dollars for motorists in regional areas and in the outer suburbs who often drive hundreds of kilometres each week," he said.

"This new tax is yet another example of the Federal Government milking motorists."

Mr Spalding said the RACQ believed the government should spend the tax revenue from fuel on building roads.

The taxi industry is traditionally a big user of LPG, and Taxi Council of Queensland president Max McBride said it would have an impact on fares.

"But more and more cabs are moving away from LPG," he said.

"We have 35% of our fleet now composed of hybrids."

Mr McBride said the cost increase would be factored into a model the State Government used to adjust fares every six months.

He said costs such as registration, insurance and fees paid to the company were all taken into account.

But by the time of the next review in June, the price of LPG could well have fallen.

"We find the price fluctuates, and during the Northern Hemisphere summer it usually falls," he said.

Bundaberg LPG Conversion Centre manager Martin Tanner said the price rise would have some effect on his business.

"But people who are doing lots of kilometres are still changing over," he said.

"It makes sense if you add it up."

Mr Tanner said the cost of converting to LPG was between $3000 and $5000, depending on the car.

Topics:  australian government lpg motorists tax

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