Call to cut fuel tax

www.heraldsun.news.com.au By KAREN COLLIER and FLEUR ANDERSON 04mar03

DRIVERS hurting from soaring petrol prices have united to plead for fuel tax cuts.

Victoria's peak motoring group, the RACV, claims rocketing fuel costs could pump up to $750 million a year extra into Federal Government coffers.

Peak unleaded petrol prices have crashed through the $1 mark nationwide as higher crude oil costs triggered by war jitters and a strike in Venezuela flow through at the bowser.

RACV government relations spokesman David Cumming said constantly high fuel prices could grab up to $250 million extra a year in GST, and up to $500 million more from a resource rent tax levied on oil producers.

But Treasurer Peter Costello last night denied the Government would cash in on drivers' pain.

Mr Costello said petrol tax revenue remained in line with forecasts and that the Government may actually get less money from motorists' pockets.

The RACV said that in Victoria for every litre of petrol costing $1, the Government reaped 46.79c. This included excise at a fixed 37.7c and GST at 9.09c.

The motoring group plans to approach Prime Minister John Howard to cut excise by 10c a litre if petrol costs do not ease within a fortnight.

Business banking officer Paula Bouboukis, of Caroline Springs, joined the call for fuel tax relief to be considered.

Ms Bouboukis started catching a train to work a fortnight ago instead of driving because of higher petrol prices.

"Every extra dollar to fill up the car counts when you are a single parent and paying off a mortgage," she said.

But Mr Costello insisted the Government was not in line for a tax windfall.

"The Government has frozen excise -- this does not go up with CPI or inflation," he told the Herald Sun last night.

"The GST goes to the states. The Commonwealth does not get extra GST."

Mr Costello rejected Opposition figures predicting the Government would reap at least $600 million more from the GST and petroleum resource rent tax this financial year.

Mr Cumming said drivers were the victims of war jitters and warned continued high prices could not be tolerated.

"Country towns are already beginning to hurt from people having less left over in the budget each week," he said. "We are paying an unfair war premium for a conflict that may or may not happen.

"The Government cannot do anything about the rising crude oil price, but it can certainly do something about tax."