Update: this proposal, moving from a fuel tax paid directly at the time of purchase, to an indirect payment via bank accounts has the look of China interfering in things. Sounds conspiratorial I know, but they do have a system where all users pay for all miles electronically. It is possible the NZ government have done a technology deal with China, and this will allow China to sell their technology and know everything about our vehicle use at the same time.
The New Zealand Minister of Transport, Chris Bishop has announced plans to change the way road users are taxed. He wants to move the NZ transport fleet onto a fully digital platform, with every vehicle paying according to the weight class of the vehicle, monthly direct. He likened this to paying for your Netflix account.
Currently, petrol vehicles pay fuel taxes on each litre of petrol poured, while diesel vehicles pay Road User Charges (RUC's). Light diesels pay off the odometer, while heavy diesels pay via a hubodometer fitted to a wheel hub on the truck. Diesels have to display their RUC sticker, and if they're caught not having the mileage paid for, they can receive heavy fines.
So, what's wrong with the proposal as put? For starters, for most road users it means yet another bill arriving at the end of the month. We need that like we need a hole in the head. Right now, we pay at the pump and that covers maybe 80% of all users. So, we pay the once now, what's wrong with that and why change it? Then, the car fleet is quite old and so all these cars will require a costly upgrade to add the technology to them. Many people simply do not have this kind of money. And another problem; the tax is now paid when the petrol is bought. That's simple and effective. But, under this new scheme, what happens when the road user cannot pay?
The reason Bishop wants the change is because EV's and hybrids mean less fuel is being sold, and so the tax take is down. Those batteries are heavy, and they cause more damage to the roads by adding weight to every journey.
Here's a simple solution Bishop has not thought of: why not raise the price of annual vehicle registration for EV's and hybrids, and adjust the amount of fuel tax taken as well, to cover for any increase in road use over the year. Yes, this would mean a slight subsidy by petrol cars of hybrids but it would be a small amount and easily forgotten as there would be no extra steps required, just the amount would differ.
Bishop was on the TV talking about how easy it would be for cars to be fitted with transponders. Err...that's old tech, he's so out of touch. I was in Queensland when they went from transponders to number plate recognition. They're now so advanced, they know the vehicle and how much it has on board (truck ride height and the like is measured).
Chris Bishop is as silly as a wet hen.
Labour are no better, their leader Chris Hipkins agrees with Bishop. Clearly, it hasn't occurred to him to simply adjust EV and hybrid registration fees and to make an adjustment to fuel taxes.
Another problem which will be felt in the poorer regions; car users will be incentivised to not bother registering or getting a Warrant of Fitness (WOF) for the car. You must have a WOF to be registered, so I'm guessing part of the WOF procedure will involve checking the car is enabled for road user charges. What will happen? Car owners will increasingly not bother getting a WOF, thereby not registering, and driving uninsured. Some regions have only 60% compliance at the moment. If the fuel at the pump is cheaper, why spend money on an old car to bring it up to speed! So, the roads will have even more unregistered vehicles out there.
https://www.rnz.co.nz/news/political/569149/road-user-charges-for-all-vehicles-move-a-step-closer
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