RUCs to apply to all vehicles (incl EVs), replacing road user tax on petrol

Forums › Transport (cars, bikes and boats) › RUCs to apply to all vehicles (incl EVs), replacing road user tax on petrol

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#3128020 15-Sep-2023 08:33

mattwnz:

But instead council rates are usually based on the houses capital value, and it has become a form of wealth tax, and people are charged more if they own a more expensive house, almost solely because they have the ability to pay higher rates.

Off topic, but I have no problem with council rates being tied to property capital value. Taxes aren't meant to be fair and they're not always meant to be a user pays system either. At their core, taxes are a redistribution of wealth so those that can pay more, do. And those that can't, pay less. This is why the lack of a capital gains tax in NZ doesn't make any sense. Without capital gains, the squeezed middle get squeezed more as we aren't taking enough tax from the asset rich.

Back on topic.

Senecio

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#3128023 15-Sep-2023 08:38

If anyone is disputing the impact of up front RUC in increments of 1,000km will have to low income workers, then you just have to come to a South Auckland service station. I regularly pass through Otara on my way to work and I often see people putting $30, or even $20 in their cars. $20 a day is what it costs me for my daily commute.

alasta

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#3128033 15-Sep-2023 09:09

Chats: So how does this scheme benefit anyone who is really struggling in a supposed cost of living crisis - or is it now just a politically correct term to to hide the real issue of maybe there's an ever widening inequality crisis.

I think the real underlying issue is car dependance, particularly for those doing shift work or living in rural areas. Car ownership is horrendously expensive, particularly where the car is old or under maintained.

At some point the government is going to have to look at targeted interventions to help people to transition away from car ownership.

HarmLessSolutions

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#3128037 15-Sep-2023 09:24

alasta:
Chats: So how does this scheme benefit anyone who is really struggling in a supposed cost of living crisis - or is it now just a politically correct term to to hide the real issue of maybe there's an ever widening inequality crisis.

I think the real underlying issue is car dependance, particularly for those doing shift work or living in rural areas. Car ownership is horrendously expensive, particularly where the car is old or under maintained.

At some point the government is going to have to look at targeted interventions to help people to transition away from car ownership.

This is the scenario that your comment brings to mind. The changes to our transport environment will be driven primarily by economic factors.

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frankv

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#3128040 15-Sep-2023 09:32

Senecio:

If anyone is disputing the impact of up front RUC in increments of 1,000km will have to low income workers, then you just have to come to a South Auckland service station. I regularly pass through Otara on my way to work and I often see people putting $30, or even $20 in their cars. $20 a day is what it costs me for my daily commute.

Yes... a number of years ago, I filled in for a day at a petrol station. I was astounded at people putting $2 worth of petrol into their cars, and paying $2 in cash and $2 from credit card for $4 worth of petrol.

The real question is why it costs $6 to do a transaction. It costs banks a cent or so for online transactions.

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#3128042 15-Sep-2023 09:37

MikeB4:

@GV27 just because it could be collected via general taxation and GST does not mean it cannot be ring fenced for transport infrastructure

Even if was ring-fenced for "transportation", that can be siphoned off to other departments by them charging transport for doing something. And, knowing that there's going to be income from RUCs, the government can divert other funding away from transportation towards other departments.

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#3128158 15-Sep-2023 14:40

My opinion.

RUC for EV's, perhaps at a lesser rate to RUC for diesels as an ongoing incentive for their use.

Leave Petrol tax alone. Being more fuel efficient, hybrids will remain appealing because though the petrol tax rate is the same, you're buying less of it.

I bought a Prius and have run two full fuel tanks in it in about a month. My fuel efficiency has nearly doubled, but i'm still consuming petrol and thus still paying excise tax... it's easy, existing and IMO not worth changing until the revenue hole through reduced fuel consumption outweighs the value of that same reduced fuel consumption (carbon wise).

No signature to see here, move along...

HarmLessSolutions

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#3128164 15-Sep-2023 14:54

BlakJak: My opinion. RUC for EV's, perhaps at a lesser rate to RUC for diesels as an ongoing incentive for their use. Leave Petrol tax alone. Being more fuel efficient, hybrids will remain appealing because though the petrol tax rate is the same, you're buying less of it. I bought a Prius and have run two full fuel tanks in it in about a month. My fuel efficiency has nearly doubled, but i'm still consuming petrol and thus still paying excise tax... it's easy, existing and IMO not worth changing until the revenue hole through reduced fuel consumption outweighs the value of that same reduced fuel consumption (carbon wise).

Simeon Brown's Stuff article would seem to suggest that the workings behind the scenes on the RUC redesign have moved well beyond that.

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smac

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#3128167 15-Sep-2023 15:01

HarmLessSolutions:

BlakJak: My opinion. RUC for EV's, perhaps at a lesser rate to RUC for diesels as an ongoing incentive for their use. Leave Petrol tax alone. Being more fuel efficient, hybrids will remain appealing because though the petrol tax rate is the same, you're buying less of it. I bought a Prius and have run two full fuel tanks in it in about a month. My fuel efficiency has nearly doubled, but i'm still consuming petrol and thus still paying excise tax... it's easy, existing and IMO not worth changing until the revenue hole through reduced fuel consumption outweighs the value of that same reduced fuel consumption (carbon wise).

Simeon Brown's Stuff article would seem to suggest that the workings behind the scenes on the RUC redesign have moved well beyond that.

Well yes and no. As I said in the post that kicked all this off, the crunch comes in April unless a legislative change is made. Alternatively they extend the EV exemption a bit more. Labour has left the door open to do that, as their original plan was for the exemption to remain in place until EV's were 2% of the fleet. They're still only at 1%, but 50% of new sales are EV so it's inevitable. However it's National who have decided they know better, and said they won't extend the exemption. But I very much doubt they have considered the operational hoops that have to be gone through to make that happen, it's just politicians doing what politicians do, deciding they know best.

everettpsycho

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#3128257 15-Sep-2023 18:02

smac:
FED is still pre-pay, just like RUC....you haven't used the fuel/driven the km's yet. As mentioned above this isn't a poverty trap, the cost will work out roughly what it always has. Anyone who can't afford to buy RUC will be the same people who can't afford petrol now. Potato potato.

It's not the net pricing that's the issue, there's two potential problems, the transition is the harder to avoid one, where that last tank of petrol will be taxed, and then $76 charged for RUC. Even if the two don't overlap exact going from post paid to pre paid will mean people suddenly need to find $76 that they don't have. It would be like your phone provider saying we know you pay at the end of the month but now we are making you pay for your plan up front, so this month you owe us double then it's back to monthly. Sure overall you don't pay a cent more than you always did but double for a month is an expense some simply can't afford.

Also never underestimate some people's lack of budget or inability to spend responsibily. Right or wrong a lot of people are just outright rubbish with money, when paired with low earners that struggle to get by it's a lethal combination. There is people in this world that literally have to borrow $5 to get to work, or in this case $76 for 1000km of charge. Most on here seem to be fortunate enough to have the cash for this to not be a problem but it's a problem if politician implement big changes like this and don't consider these people. This is another reason why April just isn't realistic, this scenario they have to communicate and give people in this situation time to be able to have some money to preload their Ric's when it goes live.

cddt

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#3128281 15-Sep-2023 19:19

Senecio:

If anyone is disputing the impact of up front RUC in increments of 1,000km will have to low income workers, then you just have to come to a South Auckland service station. I regularly pass through Otara on my way to work and I often see people putting $30, or even $20 in their cars. $20 a day is what it costs me for my daily commute.

Yeah that is what I see as well. Or people who ask for a very specific and small number, like $6, $8 or $12 because that's all they can afford.

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#3128347 15-Sep-2023 21:09

BlakJak: My opinion.
RUC for EV's, perhaps at a lesser rate to RUC for diesels as an ongoing incentive for their use.
Leave Petrol tax alone. Being more fuel efficient, hybrids will remain appealing because though the petrol tax rate is the same, you're buying less of it.

I bought a Prius and have run two full fuel tanks in it in about a month. My fuel efficiency has nearly doubled, but i'm still consuming petrol and thus still paying excise tax... it's easy, existing and IMO not worth changing until the revenue hole through reduced fuel consumption outweighs the value of that same reduced fuel consumption (carbon wise).

The way I see it is that when you pay RUC on EVs then you really need to pay RUC on hybrids, in particular PHEVs the reason for this is that depending on how they are driven they can be run fully electric and therefore will pay no tax (unless subjected to RUC) however if you make PHEV subject to RUC but not other vehicles then you will have the issue of double taking PHEV based on them also consuming petrol and paying tax that way..

The only logical result is therefore to make all vehicles subject to RUC. I do think a lower rate should be used. I drive a big ute and don't think a small car should be paying RUC at the same rate.

HarmLessSolutions

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#3128348 15-Sep-2023 21:15

weasel13: ......

The only logical result is therefore to make all vehicles subject to RUC. I do think a lower rate should be used. I drive a big ute and don't think a small car should be paying RUC at the same rate.

That situation can be remedied by increasing the carbon tax on petrol and/or diesel to disincentivise fossil fuel use. That way larger vehicles are taxed more so than small.

https://www.harmlesssolutions.co.nz/

weasel13

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#3128354 15-Sep-2023 21:37

HarmLessSolutions:
weasel13: ......

The only logical result is therefore to make all vehicles subject to RUC. I do think a lower rate should be used. I drive a big ute and don't think a small car should be paying RUC at the same rate.

That situation can be remedied by increasing the carbon tax on petrol and/or diesel to disincentivise fossil fuel use. That way larger vehicles are taxed more so than small.

Read the rest of my comment... it relates to when EVs will have RUC added to them not if... therefore the only logical course of action is to have RUC added on all vehicles

Plus EVs do need to pay their share of road maintenance. They shouldn't get a totally free ride

HarmLessSolutions

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#3128403 16-Sep-2023 07:52

weasel13:

Read the rest of my comment... it relates to when EVs will have RUC added to them not if... therefore the only logical course of action is to have RUC added on all vehicles

Plus EVs do need to pay their share of road maintenance. They shouldn't get a totally free ride

Sorry if you misunderstood. My comment re carbon taxation is in conunction with distance based RUCs. If RUCs are levied on all road vehicles including EVs then a carbon tax can be used to disincentivise fossil fuel use.

https://www.harmlesssolutions.co.nz/

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