Fuel excise subsidy to end on Sunday as fears petrol prices will soar again
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Fuel will become more expensive from Sunday as the government has ruled out extending a cut to the fuel excise, the finance minister confirmed.
Katy Gallagher said the 16 cents per litre cut to the fuel tax was always intended as a temporary measure, but claimed the Albanese government is focused on delivering “ongoing” relief to cost of living pressures hitting millions of Aussies.
Australians are facing the prospect of paying more for their petrol in the coming days. Getty Images
“The decision around reducing the fuel excise was a temporary decision,” Gallagher told Today. “It was taken initially when those prices for petrol in particular skyrocketed after war in the Middle East.”
The excise cut was supposed to end on July 1, but was extended for an extra month as the war continued, wreaking havoc with global oil prices.
Recent escalations in the conflict have seen the price of oil jump from $75 to over $100. It currently sits at around $85.
The latest figures from the NRMA say the average cost of unleaded fuel in Sydney sits at 186.8 cents per litre, but this will rise when the reduction to the fuel excise expires on Sunday.
Gallagher acknowledged this wasn’t welcome news, but insisted the government’s focus on long-term solutions would be more beneficial to Australians in the long run, rather than temporary measures that could add to inflation.
“That’s always been central to our thinking: how do we provide cost of living help without adding to some of the inflationary pressure we’re seeing in the economy,” she said.
Katy Gallagher insisted the government was better off providing more long-term relief rather than reprieve’s from cost of living pressures. Today
“That’s why we’ve got those tax cuts rolling through now. And that’s not just temporary assistance, that’s ongoing assistance.
She claimed measures to make medicines cheaper and to make it less expensive to see a doctor were also part of this, but she cautioned the budget needed to be managed within providing cost of living relief.
“We recognise people are finding it pretty tough right now, and part of our job is that we are managing that, managing the budget,” she said.
Aussies received a boost on Tuesday when headline inflation fell to 3.8 per cent, cutting the chances of an interest rate hike next month.
Gallagher said the signs were “encouraging”, but refused to comment on whether the Reserve Bank of Australia would hold or cut the cash rate on August 11.
“We don’t get into speculating about the decisions the reserve bank may make, they are independent, and they make those decisions as a board based on all of the information before them,” she said.
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