Call for national petrol inquiry

September 8, 2005 - 8:03AM

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The NSW government has backed calls for a national inquiry into the skyrocketing price of petrol and its impact on families.

The call comes as Victorian Nationals leader, Peter Ryan, yesterday accused the State Government of pocketing a GST windfall profit every time the fuel price went up.

NSW Transport Minister John Watkins said today there was a lack of understanding in Canberra about the problem.

"Families across the state are being slugged every time they fill up," Mr Watkins said in a statement.

"The impact on their budgets just to get around - to work, to the kid's school, to sporting or entertainment events - it's just unsustainable."

The federal government needed to ask where petrol profits were going, Mr Watkins said.

The government itself also collected on the deal, he added, with two taxes, fuel excise and the GST, tacked on to the cost of petrol.

PM rejects excise cut

Prime Minister John Howard refuses to cut fuel excise despite thy record world oil prices pushing petrol to almost $1.40 a litre.

Motorists in Sydney, Melbourne and Canberra paid as much as 139.9 cents a litre yesterday, while prices have reached 137.9 cents in Perth and 134 cents in Adelaide.

And they could continue to rise as the devastating effects of Hurricane Katrina on oil markets hit home.

But Mr Howard said yesterday that cutting the excise by enough to make a difference would cost the government billions of dollars.

"I'm sorry, and I know this is not a popular thing to say, and I know people are hurting, but the fact is, to have any appreciable impact on the price, you're looking at billions and billions," Mr Howard said.

GST windfall

Surging fuel prices were delivering windfall gains through GST revenue to the Victorian government, The Nationals leader Peter Ryan said today.

In parliament Mr Ryan challenged the state government to return some of that bonus to Victorian drivers struggling with record fuel prices.

In a statement earlier, Mr Ryan said the state government's share of GST revenue on petrol prices was close to $420 million a year.

Every 10 cent rise in fuel delivered another $35 million in revenue to the treasury, he said.

"It is receiving a windfall profit every time the fuel price goes up.

"Some of it should be rebated back to motorists to relieve the financial pressure on families throughout Victoria."

Bracks hits back

Premier Steve Bracks hit back at Mr Ryan's proposal during parliamentary Question Time saying the federal government itself imposed the greatest tax on petrol through a 37 cent per litre excise.

Mr Bracks said petrol prices in Australia rose according to the global price for petrol.

"The GST is on total consumption," he said.

"GST is on petrol but it's on other goods as well.

"So if people spend more on petrol but less on other goods the total GST take is much the same.

"These are not my words, these are the words of the Prime Minister answering that very question."

Earlier, Mr Ryan said country Victorians were hit worse by the record prices with regional fuel prices well in excess of city prices.

"If people are forced to reduce travel to visit family and friends or attend social and sporting functions it will add to the isolation of rural families and have significant social and health impacts.

"At least in the city there is a heavily taxpayer subsidised transport system which provides alternatives for the travelling public."

