An increase to the fuel excise came into effect today, increasing cost-of-living pressures on Australian households.
Australian motorists will be paying more at the service station bowser from today, following an increase to the fuel excise.
The bi-annual increase is in line with the Consumer Price Index (CPI), rising from 48.8 cents per litre to 49.6 cents per litre – before GST is applied.
It’s understood 3.2 per cent of the Federal Government’s 2021-22 budget was raised from the fuel excise – amounting to $18.2 billion.
The vast majority of the money raised by the fuel excise is meant to go towards road infrastructure programs across the country – up to 91 per cent – however only 68 per cent was actually spent on roads during the 2021-22 Financial Year, as reported in September 2023.
The Australian Government has indicated it is considering introducing a tax on electric cars in an effort to recoup lost revenue from the fuel excise, due to an increase in the number of electric and plug-in hybrid cars on our roads which purchase either less fuel or no fuel at all.
While the increase to the fuel excise is less than one cent per litre, it is expected to increase pressure on household budgets.
According to the Australian Automobile Association – the body representing state motoring groups including the NRMA, RACV, and RACQ – household transport costs have increased by 9.4 per cent in the 12 months to September 2023.
It’s estimated Australian households now spend 16.3 per cent of their income on transport costs – including fuel, finance, insurance, and maintenance.