Petrol prices are set for another hike after the government says more money is needed for the country’s transport infrastructure and safety.

Almost half the cost of petrol is to pay for tax and that's reportedly left most motorists very frustrated.

According to Dave Bodger, managing Director of Gull NZ, the fuel tax is a necessary part of society.

“The government uses that money. They put asphalt into our roads, they give us the police to keep us safe and so I think that's a fair slice of the pie.”

And PM Jacinda Ardern says it’s set to go up.

“...fuel excise increase of roughly 9c - 12c over three years.”

But just how much fuel tax are consumers paying?

If you were to pay $2 a litre, about 58 cents of that pays for the fuel, 46 cents goes to the retailer and 4 cents pays for shipping.

That leaves 66 cents for tax and 26 cents for GST which means that 46% of what you pay at the pump goes to tax.  

Mark Stockdale from Automotive Association NZ says fuel GST needs to be wiped because a double tax is not fair.

“Excise is a tax. That's 60c a litre for the National Land Transport Fund. There's another 6c a litre that goes to ACC to pay for road crashes and then the GST is applied on top of that. So we're paying twice and I just think it's wrong.”

Meanwhile, at parliament, opposition leader Simon Bridges warns the hike could see motorists paying up to 25 cents more at the pump, but Transport Minister Phil Twyford says the tax hike will mean safer road.

 

Whatever the case, it looks like filling a tank will be that much dearer. 

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