PERTH (miningweekly.com) – The Minerals Council of Australia has applauded comments by Prime Minister Anthony Albanese that the government will not consider changes to the Fuel Tax Credit (FTC) scheme, with CEO Tania Constable saying it is recognition of the importance the scheme plays in the current and future prosperity of regional Australia.
Albanese’s comments come days after the Grattan Institute released a report calling for the A$8-billion-a-year FTC to be halved, saying the reduced capital outlay was justified in "economic and social terms".
“Fuel tax credits are gnawing away an ever-growing share of fuel tax revenue: a decade ago, credits reduced gross fuel tax revenue by 30%; today, it’s almost 40%. Winding back the credits could reduce the structural budget deficit by about 10%, or A$4-billion a year,” the report read.
“It would also help Australia hit its target of net-zero emissions by 2050, because burning diesel contributes about 17% of Australia’s total carbon emissions.”
Currently, no fuel tax is payable for vehicles driven off-road, such as mining trucks, while a reduced rate of fuel tax is payable for on-road vehicles heavier than 4.5 t.
Constable said on Thursday that messing with such a vital scheme that supports regional businesses, job creation and community investment was always a dangerous ploy, guaranteed to backfire.
“It would have compounded the economic pain that Australians are currently experiencing, with high inflation and increasing interest rates.
“After yesterday ruling out any changes to the FTC scheme, the federal government should champion the scheme’s permanency within the tax system, giving Australian businesses certainty moving forward,” Constable said.
“The scheme should never have a question mark over its future. Not now, not ever. We must get off this budgetary merry-go-round, where governments look to raid the scheme in the erroneous belief it will help budget repair, when in fact it would hinder.
“Governments are too quick at taking aim at business, consistently changing the rules, making it more difficult to do business in Australia, and damaging our international competitiveness whether you are a big business or a small business, a supplier or a manufacturer, a sole trader or an employee,” Constable said.
“The federal government must provide business with greater certainty, not a pervasive fear of what may be coming down the line. Such a cloud of uncertainty will smother investment and job creation, at a time when Australia needs them the most.”