Economists slam Ministry of Transport fuel tax statistics

Drive 28/06/2018

Transport Minister Phil Twyford has released new figures showing that the looming fuel tax hikes will hit wealthy people the hardest, rather than those on low incomes.

That’s despite warnings that it would be poor communities who would be most affected by the 11.5 cent per litre Auckland fuel tax.

The Minister says in Auckland the wealthiest 10 percent of households will pay $7.71 per week more for petrol, while those on the lowest incomes will pay half that.

These numbers have been slammed by economists as unreliable because they include young people who don't own cars.

One of those economists that say the statistics are 'simply untrue' is Sam Warburton from New Zealand Initiative.

He told RadioLIVE: "The tax applies to how much fuel you use. So if you've got an old, big vehicle that churns through a lot of fuel - you're going to pay a lot of tax."

Mr Warburton says a lot of poorer people don't own cars because they cannot afford one.

"When we look at just the people who own cars, according to my analysis, poor people pay more per kilometre they drive because they use more fuel."

He says that's because they have older, bigger cars.

"And they also drive more. If you think of a Maori family with three or four kids, they're going to be taking their kids around everywhere, they might live in South Auckland - which is poorly serviced by public transport so they have to use their car.

"Maori will pay 14 percent more than non-Maori," Mr Warburton said.

Listen to the full interviews with Sam Warburton above.

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