ACC's proposed increase in its motor vehicle levy could see motorists around the country paying more at the petrol pump, but AA says it's not the time for another tax.
Photo: AFP
With a number of goverment-imposed petrol taxes already put in place this year, there are questions on why another petrol tax is being lumped on motorists.
ACC's proposed motor vehicle levy could add another 2 cents per litre to already sky-rocketing fuel prices.
In Auckland the price of unleaded fuel is hitting $2.40 per litre, while in Queenstown prices are nearing $2.60 per litre.
The plan to raise the levy will also hit vehicle registration costs, which are set to rise about $15 to just under $128.
ACC chief customer officer Emma Powell said rising medical costs related to road accidents were the reason for the increase.
"It's really driven by the increase in injuries and the increase of cost of those more people needing weekly compensation.
"Another factor is the care that our home and care supporters provide for those injuries."
With more cars on the road, Ms Powell said it was important to split the levy increase.
"People are more at risk on the roads so we're suggesting some of that levy should come from petrol and not just the registration."
AA principal advisor Mark Stockdale said ACC has had record low levies for the last few years.
"I'm sure motorist will remember not so long ago they were paying much higher ACC levies and it was costing $300 or more to register your vehicle every year."
However, Mr Stockdale said now was not the time to be looking at another petrol tax - with a petrol excise tax of 3.5 cents set to kick in on Sunday.
"Motorists are going to be pretty uncomfortable with the amount they're already paying for petrol and the fact petrol is going up even further as a result of government imposed taxes."
ACC Minister Iain Lees-Galloway said the corporation would have to make a compelling case to get its plan through Cabinet.
Mr Lees-Galloway said the government was acutely aware of rising living costs and it would need to be a very strong case.
In July a regional fuel tax was put in place in Auckland and motorists were whacked with an 11.5 cent per litre increase on petrol.
Since then more than $13.2 million has been collected, but Auckland Action Against Povery co-ordinator Ricardo Menendez March said those struggling to live in Auckland would suffer the most.
"It will affect low-income families and those in public-transport deprived areas disproportionately," Mr Mendendez March said.
"Families are already seeing an increase in the cost basic goods, rents as well as petrol."
Public submissions for the proposed levy changes can be made until 25 October.