Taxed to a standstill

The following opinion piece by AWU National Secretary Bill Shorten was published in Melbourne's Herald Sun newspaper on Friday August 19, 2005

John Howard was at it again last week: playing the role of the workers' friend while behind the scenes putting his hand in their pockets and stealing from their wallets.

The Prime Minister told the Herald Sun he shared the pain caused by skyrocketing petrol prices.

"I guess, in a sense, every time I see the oil price go up I wince like everybody else, because I know the pain that is inflicting on families," he said.

He might know of the pain but does he feel it?

Of course not.

The Prime Minister is one of those lucky Australians - those with fleet cards - who don't have to pay for petrol.

Members of the Australian Workers' Union and other ordinary working Australians deserve more than the fake sympathy of someone who doesn't have to scramble for another item in the supermarket just so they can qualify for a shopper docket.

If the Prime Minister is fair dinkum, why doesn't he consider introducing a $200 tax deduction for every employee, parent, student, volunteer and carer for petrol consumed collecting from childcare, travelling to work, learning, or community building?

And perhaps a rebate if motorists move to more fuel efficient Australian-made cars or install a gas tank.

At the very least, Australians deserve the truth.

Why doesn't the Prime Minister explain why the price of petrol is more expensive in Australia than in the US or Canada?

Did you know that in Malibu, California, the price of a Big Mac is A$3.36? In Melbourne, it is A$3.25.

And the price of a litre of milk in Malibu is A$1.30. In Melbourne, it is A$1.25.

But in Malibu and right across the United States, the price of unleaded petrol is around A$0.87 per litre, compared with A$1.20-plus per litre in Melbourne.

So when Big Macs and milk are priced the same and we face the same international challenges, why is our petrol price significantly higher?

Canada and the US share a lot in common with Australia.

Like us, they are domestic fuel producers, and have cities which are geographically spread and which are more car-dependent than countries in continental Europe (where petrol taxes are higher but the population is more dense and there's more public transport)

Yet, we are taxed more than Americans and Canadians.

Retail taxes account for about 43% of the pump price here, compared to 31% in Canada and 17% in the United States.

We need truth in labelling so that each service station displays a breakdown of all the components that constitute the price of petrol, including the retail tax take.

The massive increase in petrol prices should also focus our attention on the unfairness of the tax system.

We have a two-class taxation system - even down to petrol.

Not only does an employee earning more than $63,000 face higher marginal tax rates than Australian billionaire companies, but ordinary taxpayers get second class treatment at the petrol bowser.

Companies, farms, small businesses legitimately can claim the cost of the fuel excise tax.

The government expects to collect nearly $14 billion in fuel excise taxes in 2005-06, $4.2 billion of which will be returned to businesses.

Yet, employees and their families pay in full for petrol.

It is PAYE taxpayers who are most hurt by higher petrol prices, particularly mums and volunteers and commuters and residents in the outer suburbs and in the regions and rural households with few public transport alternatives.

What about the worker who uses a tank per week going to and from work, who cannot claim?

What about his wife who works part-time and takes their children to and from childcare every second day, who cannot claim?

What about families taking mum out of aged care on Sunday for a drive, who cannot claim?

The government has no long-term solution, nor any short-term relief.

Well, I put the challenge out to the Prime Minister.

Why does Australia need such high petrol taxes when petrol prices are soaring and so little of the tax is returning to our roads or motorists?

Why can't he offer Australians a tax deduction for petrol consumed?

Wouldn't that lessen the pain for those who really do have a legitimate need to wince when they fill up?