The Australian Retail Council (ARC) has applauded the Federal Government’s decision to halve the fuel excise on petrol and diesel, as well as pause the heavy vehicle road user charge for three months.
Following a meeting of the National Cabinet today convened by the Prime Minister Anthony Albanese, the Australian Government will halve the fuel excise on petrol and diesel for three months.
The halving of the fuel excise will reduce the cost of fuel by 26.3 cents per litre. This will reduce the cost of a 65L tank of fuel by nearly $19.
ARC CEO Chris Rodwell said the measures are a practical and timely step that will provide immediate relief to retailers facing sharp increases in freight and logistics costs, while also easing pressure on household budgets.
“The Government’s decision to halve fuel excise and suspend the heavy vehicle road user charge will ease pressure across retail supply chains. This is critical given more than half of retailers are experiencing increases in freight and shipping costs of more than 10 per cent,” Rodwell said.
“The cut will make a meaningful difference in the short term, particularly for small retailers. It is important that we stay alert to other options to support retailers and households. Almost all retailers (96 per cent) anticipate supply chain challenges will intensify if this conflict is protracted.”
The Albanese Government said the spike in fuel prices as a result of the war in the Middle East is hurting Australians and causing financial stress. The halving of the fuel excise will commence from April 1 and run to 30 June.
Alongside the heavy vehicle road user charge pause, the Government will also defer the next scheduled increase in the Heavy Vehicle Road User Charge by six months.
“Australians are encouraged to use public transport wherever possible to help conserve fuel for the regions, and we welcome existing moves to cut the costs of public transport,” the Albanese Government shared on the PM’s website.
“While Australia’s fuel supply outlook remains secure in the near term because of the actions the Albanese Government has taken, the longer this war goes the worse the impacts will be. We are acting now to prepare and shield Australians.”
Since the conflict commenced four weeks ago, the Government has doubled penalties for petrol companies for price gouging, released 20 per cent of Australia’s petrol and diesel fuel reserves and targeted it to regional areas, and is engaging with global partners to support ongoing supply flowing. This includes a supply agreement with Singapore.
Rodwell said efforts to improve fuel security and reduce the fuel excise cut are important steps, but broader action is needed to address structural cost pressures.
“There is a clear need to improve supply chain resilience,” Rodwell said. “We also need to deepen efforts to reduce the overall cost of doing business. That includes tackling regulatory complexity, easing compliance burdens and improving productivity across the economy,” he said.
“The upcoming Federal Budget is a critical opportunity to get this right.”