Fuel Tax Insanity
The Ricegrowers’ Association of Australia (RGA) is frustrated that this is still up for debate. Any move to scrap or wind back the Fuel Tax Credit (FTC) would wrongly tax off‑road fuel use and drive up prices across the economy.
Fuel excise is a road tax, designed to fund the construction and maintenance of public roads. The Fuel Tax Credit ensures that fuel not used on public roads — such as agricultural machinery, fishing trawlers, mining equipment and generators — is rightfully refunded.
“Fuel that isn’t used on roads shouldn’t be taxed — it’s that simple” said RGA President Peter Herrmann. “The Fuel Tax Credit doesn’t provide a handout. It simply refunds where there is no road use.”
The RGA said recent speculation about changes to the Fuel Tax Credit misunderstands its purpose and risks imposing a hidden tax increase on Australia’s productive industries. The downstream result is a cost increase to production and ultimately food and fibre.
The Fuel Tax Credit is relied on by more than 600,000 businesses across agriculture, fishing, mining, tourism, construction and transport, most of them operating in regional and remote Australia.
In agriculture alone, diesel powers tractors, harvesters, irrigation systems and on‑farm machinery that never touch public roads. Fishing trawlers operate on water, not highways. Mining equipment operates underground or on private haul roads.
“Turning a road tax into an off‑road tax would be a fundamental misuse of the tax system,” said Mr Herrmann.
The RGA joined other members of the Fuel Tax Credit Alliance in calling for the retention of the FTC in its current form, stressing that policy stability is critical for investment, productivity and regional economic resilience
“Our position is clear,” Peter Herrmann said.
“Road taxes should apply to road users — and off‑road fuel should not be taxed. If it is, Australians everywhere will pay the price.”
End.