Tuesday, June 28, 2005

Petrol and Taxes...

I'm sure you have all heard about the price of petrol is about to hit $1.20 in most Australian capital cities in the next few weeks, and from this has come calls for the government to do something about it. Whether it be forcing the oil companies to cut their margins further, cutting the fuel tax or even giving a rebate to low income earners, people want something to be done.

I came across
this article in the todays SMH which is reporting that economists believe the amount of tax on petrol is too low when compared to other countries around the world (see chart below).



At first I thought that we pay way too much for our petrol, especially when you use the US as a comparison. But after looking at that chart I think we are actually quite lucky when it comes to the price of petrol.

Back to the article, there are some good points raised by the economists for their reasoning behind increasing the tax of petrol, namely trying to get people to move to more efficient forms of transport.
Economists warned yesterday that cutting fuel tax could lead to an unsustainable reliance on an expensive non-renewable energy source and discourage the uptake of more energy-efficient methods of transport.
The article also referred to the way Australians view their cars, as a necessity, when in fact they are a distinct luxury. There are other ways to get around, I too am guilty of jumping in the car to duck down to the shops not far away, but if the price of fuel were to jump to $1.50 a litre, wouldn't that force most people to rethink their car usage?

1 comment:

Herr skekSil said...

I have to agree with the analysis.

It would be interesting to measure though the price of diesel - remembering that Europe is a major consumer in this area compared to Australia?