Bill Shorten (Maribyrnong, Australian Labor Party, Assistant Treasurer) Share this | Hansard source

I also find it a bit rich as the facts do not support the assertion. LPG will continue to exhibit a significant price advantage over regular unleaded petrol. The effect on taxi fares of including LPG in the excise system depends on decisions by state and territory regulators. If the excise is passed on in full, the 2½c per litre excise that would apply from 1 December 2011 would add approximately 3.5c to the average metro taxi trip fare. When fully phased in, the final excise of 12½c per litre from 1 July 2015 would mean approximately 19c for the average taxi trip fare if passed on in full.

It should also be recognised that the cost of LPG, including excise that will apply, can be claimed as an income tax deduction by taxi operators and other business operators. This again reduces the price impact of the new excise arrangements for LPG. I also believe it is important to recognise that the impact of the LPG changes on the Tasmanian taxi industry will not be as dramatic as has been suggested. Australian Taxi Industry Association data shows that only 28 in every hundred taxis in Tasmania use LPG fuel, so, for the other 72 in every hundred of the Tasmanian taxi fleet that use other fuels, there will be no impact. More generally, LPG is cheaper and more cost-effective than petrol with, on average, a saving of around 37 per cent, or $7.44 per 100 kilometres driven. On 1 December 2011, when the excise is introduced, LPG will still have savings of around 35 per cent, or $6.94 per 100 kilometres driven. In July 2015, when fully phased in at 12½c per litre, LPG will still retain an average 25 per cent cost advantage over unleaded petrol. In addition, there will be a review after 1 July 2015, once the tax has been fully implemented, which will consider the impact of the tax, its interaction with the carbon price, and market demand for these fuels.

These bills recognise that it is appropriate that there be some contribution towards the maintenance and construction of our road system not just by the users of petrol and diesel through the excise system but also by users of other alternative fuels such as LPG. However, these bills also recognise that alternative fuels are potentially more environmentally attractive, have regional development benefits and improve Australia's fuel security. These bills get the balance right.

I commend the bill to the House.

Question put:

That this bill be now read a second time.

The House divided. [20:57]

(The Speaker—Mr Harry Jenkins)

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.

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