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NATIONAL CABINET SHOULD MEET TO DISCUSS EXTREME PETROL PRICES: FUEL EXCISE MAY NEED TO BE SUSPENDED IN ITS ENTIRETY

14 March 2022

Independent Senator Rex Patrick today welcomed support from three Premiers and some Federal Coalition backbenchers for cutting the fuel excise.

“It’s good that three Liberal Premiers have now joined my push for cutting fuel excise to help relieve some of the pressure from extreme petrol prices,” Senator Patrick said.  

“But why didn't the Premiers raise this with Prime Minister Morrison at last Friday's ‘National Cabinet’ meeting? If they're serious they'll demand another meeting this week to discuss the impacts of extreme petrol prices and press the Prime Minister to commit to cutting the Federal fuel excise by at least 50 per cent.”

“If petrol prices go significantly higher than $2.20 it may well be necessary to suspend the fuel excise in its entirety for the next twelve months.”

“While this would involve significant cost for the federal budget, it would be entirely justified by taking the edge off petrol price fuelled inflation.”  

“If the Federal Government does not act quickly and decisively, Australian families will face a triple whammy from extreme petrol prices, higher food and grocery prices and rising interest rates. Halving or indeed completely suspending the fuel excise for twelve months will provide immediate respite and reduce the likelihood of a more savage economic crunch.”

“It is important to recognise that the fuel excise is a regressive tax because family fuel consumption is largely determined by the necessity of travel to work, school etc, not by the price of petrol, and lower income households pay a greater proportion of their income on fuel than richer people do.”

“The fuel price burden is especially acute in Australia’s regions and remote areas where higher petrol prices, greater distances travelled and lower incomes apply a big squeeze on household budgets.” 

“The Prime Minister should make an immediate commitment to help struggling families across the board by at least halving the fuel excise; immediately cutting it by 23 cents a litre in the Federal budget and keeping that reduction in place without any price indexation through 2022-23. It may well be necessary to suspend the full fuel excise of 44.2 cents a litre if petrol prices keep rising.”  

“The Federal Government clearly has the budgetary capacity to provide significant fuel price relief, given the fact that Treasurer Frydenberg’s Mid-Year Economic and Fiscal Outlook statement in December revealed a huge secret election war chest of $15.9 billion allocated to decisions ‘taken but not yet announced’.”

“The current combination of extreme petrol prices and post-COVID-19 economic challenges is a special circumstance that demands immediate action from the Federal Government.”

“I’m encouraged by the support that has emerged for my fuel excise campaign. I’ll keep pressing the Government hard to help hard-pressed Australian families and small businesses by reducing the price shock at the petrol bowser.”