The 2022 budget was high on fizz but light on substance for the Australian motorist
Amidst the gleeful messaging about temporary fuel price relief and a small financial windfall for millions of Australians, there is precious little else of benefit out of the 2022 Federal Budget to report on for the motorists of today – and indeed for those who will follow.
The average Aussie motorist pays a decent wedge to the government every year by way of fuel excise, sales tax and income tax, but there appears to be very little value for money for them from this year’s budget. Let’s look at a few of the top-line items.
Infrastructure
Almost $18 billion has been earmarked for what are being called ‘priority road and rail projects’ over the next ten years. The three most eastern states benefit almost equally, with Victoria’s $3.4b edging out NSW and Queensland with $3.3b each.
South Australia ($2.8b), Western Australia ($1.7b), Tasmania ($640m) and the NT ($237m) make up the balance.
NSW’s share is allocated mostly to road, with the only rail project of note being a fast train program between Sydney and Newcastle for $1b.
Plans to fast-track a $352m bypass between Milton and Ulladulla in a hotly contested electoral seat in the south of the state – and already in planning for almost 30 years – will benefit very few NSW residents, though a $355m pledge for works on the Pacific Highway north of Sydney will assist northerly travel.
Victoria’s share, on the other hand, leans towards rail projects, with a $109.5m project for Mickleham Road the only one of note.
Queensland’s infrastructure spend is almost entirely focused on rail, as plans to create an express freight corridor between Melbourne and Brisbane start to take shape.
Western Australian drivers will see some benefit, with $320 million for the Bunbury outer ring road and $200 million to seal the Tonkin Highway forecast in the budget.
New energy vehicles
This is a depressingly short report… no further support or funding was announced or even alluded to in the 2022 Federal Budget.
In fact, if the Australian Liberal National Party is returned to office at the next federal election, it will actually spend considerably less on measures designed to lower greenhouse gas emissions, where a switch to electric motoring could potentially play a big part.
Spending on climate change measures will drop from $2b in the current financial year to just $1.3b by 2025-26, according to budget figures.
The three most populous states offer decent incentives to buyers of electric cars under $70,000, but the federal government has made exactly no progress when it comes to how the mechanics of a new energy car parc could be supported any further, at any level.
Fuel price relief
Much has already been written about the temporary halving of the fuel excise for six months.
While this will come as a slight relief to motorists who are in sticker shock after months of sky-high prices, it’s a sweetener from a pressured government, and nothing more.
The excise can and should be passed through quickly by fuel vendors, but anyone who shops around for the best price on a litre of fuel knows that it’s an inexact science – and with dramas in both Europe and the Middle East, the price of a barrel of crude oil could jump sufficiently in the space of a day to render the excise saving almost invisible.
Taxation reform
The landscape of Australian motoring has changed rapidly in the last decade – but the way in which the government taxes consumers, importers, suppliers and business has not.
Consider the fact that a whopping 33% luxury car tax – designed to protect a local industry that’s been shuttered for nearly five years and slated for removal last year – is still a part of the price of a vehicle costing $69,152 and above.
James Voortman, chief executive of the Australian Automotive Dealer Association, said “what is desperately needed is a wholesale review of the automotive taxation system in Australia”.
“This budget shows that motorists will be paying billions in taxes, such as import tariffs, the luxury car tax, fringe benefits tax, GST and excise,” he said in a statement.
“With Australia no longer manufacturing passenger vehicles and with the emergence of low emissions vehicles (LEVs), it is questionable whether our current automotive taxation regime is fit for purpose.”
