A major shake-up to fuel taxes is being considered, with a top economist revealing what it could mean for Australian drivers.
Anthony Albanese is war-gaming multiple options, including a bombshell temporary cut in fuel excise amid fears that petrol shortages are set to worsen.
After repeatedly ruling out the option until now, the government is now considering every possible option leading up to the May budget.
Government sources have told news.com.au that “everything is on the table” amid fears the crisis could worsen, and options are being developed for multiple scenarios.
However, concerns remain that cutting fuel excise would be expensive—at least $2 billion in foregone revenue for even a short-term cut—and would increase fuel demand, which is the last thing the government wants right now.
The government is also examining a national dashboard that will provide daily updates on the number of petrol stations that have run dry, which is under preparation and could be rolled out within weeks as the fuel crisis continues.
News.com.au has confirmed that the National Oil Supplies Emergency Committee (NOSEC) is working on the plan in conjunction with the states and the federal government.
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The mining billionaire Gina Rinehart, Tasmania’s state premier and Liberal opposition leaders in New South Wales and Victoria have called for a cut to the excise on petrol and diesel.
Mr Albanese was asked point-blank in today’s press conference if he would consider the Liberal leader Angus Taylor’s calls to slash fuel taxes to help struggling motorists.
In response, he offered a rambling answer about what the Liberals did in Parliament this week, before suggesting that people with the money buy electric cars.
“The opposition, having sat in Parliament all week and had the opportunity to raise whatever issues they wanted, they didn’t,’’ Mr Albanese said.
“That’s up to them, but they’ve called also for cuts to things that are making a difference to cost of living, such as batteries that are making a positive difference. They’ve called for cuts to EV support.
“I don’t think there’s anyone out there today who has bought an electric vehicle who’s regretting the decision at this point in time.”
After suggesting electric cars, Mr Albanese then added a comment that seemed to leave the door open to doing something: “Look, my government has always been strong on cost-of-living measures.”
“We’ll continue to do so. We do so responsibly within the context of our budget considerations,’’ he said.
Richard Holden, an emeritus professor of economics at the University of NSW, told news.com.au that there were lots of reasons not to cut fuel excise.
“It’s a bad idea economically because, despite the best of intentions, any government has a hard time turning the tap off,’’ he said.
“At a time when we need to be reducing demand, this is going to fuel demand.”
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Libs plan for fuel tax
Opposition Leader Angus Taylor has written to Anthony Albanese calling on the government to act urgently and temporarily halve the fuel excise for three months.
Speaking to reporters in Canberra Mr Taylor and Nationals leader Matt Canavan said the change would save Australians 26 cents per litre at the bowser.
“Anthony Albanese is asleep at the wheel. He needs to stop watching and start acting. Australians are hurting,’’ Mr Taylor said.
“Families across the country are seeing their standard of living collapse, yet Labor does nothing.
“Right now, what we need is an immediate tax cut at the bowser and a government that gets fuel to where it is needed.”
Senator Canavan claimed the change could save families up to $50 per week.
“The Australian people need some breathing space. Already, before this Iran conflict and the petrol prices surges we’ve seen already, before that, the budgets of Australian families were at breaking point,” he said.
Donald Trump on Australia
Overnight, Donald Trump said he was “surprised by Australia”, suggesting the lack of support for his operation in Iran was “not great”.
“You’ve been really honest about how disappointed you are about Sir Keir Starmer,” he was asked. “So, I’m curious about your phone calls with him.”
Mr Trump described the British leader as a “lovely man,” but said he did “something that was shocking – he didn’t want to help us.”
“Australia too. Australia was not great. So I was surprised by Australia,” he said. “I wouldn’t say anybody was great, other than the five countries in the Middle East.”
In response, Mr Albanese said President Trump was “someone who I’ve enjoyed a very constructive relationship with.”
“I said very early on that I wasn’t going to comment on all of his commentary on a day-to-day basis,’’ he said.
“I reiterate that no request has been made to Australia that has not been agreed to.
“But of course, I make the point as well that Australia wasn’t consulted before this action was undertaken, and I respect that that’s a matter for the United States.
Warning on building costs
As the fuel crisis continues, the Master Builders association has written to the ACCC requesting that the agency monitor the construction supply chain for price gouging.
“If the Iran War does not end shortly then building costs are likely to be pushed up further making getting new houses out of the ground that much more difficult,” Mathew Pollock, Executive Director of Master Builders NSW said.
The latest Master Builders Industry Forecast shows that NSW will almost certainly fail to reach the target of building 377,000 new homes by 2029.
“The chances of achieving Federal Government housing targets were remote even before the bombs started falling in Tehran and Tel Aviv and costs in the construction sector started rising even higher,’’ he said.
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