Tax White Paper: Motorists Deserve a Fairer Tax System


The peak national motoring body, the Australian Automobile Association (AAA), has used its submission to the Tax White Paper to call for major reform of motoring taxes and a road user charging model that will give motorists a fairer return for the taxes they pay.

AAA Chief Executive Michael Bradley said: “Our current taxation system embeds a growing disconnect between the way Australian roads are funded; and how they are paid for by motorists.

“Reforming transport pricing is a complex issue and one that will be politically challenging. However, it has to be tackled sooner, rather than later, as the current way Australians pay to use roads is unfair, inefficient, and no longer sustainable.

“Motorists are already paying a significant amount of tax to keep their cars on the road and they are not receiving a fair or transparent return for what they contribute each year.”

In its submission, the AAA reveals more than $32 billion is raised each year from various motoring and transport related taxes and charges including:

  • Registration
  • Licence fees
  • Stamp duty
  • Road tolls
  • Fuel excise
  • GST on fuel
  • GST on vehicle sales
  • Luxury car tax
  • Customs duty on imported vehicles
  • Fringe Benefit Tax.


“Fuel excise alone raises $15 billion a year yet the return motorists get through investment in infrastructure has been historically low with only 47 per cent of fuel excise revenue returned to road building,” Mr Bradley said.

“An honest conversation about how to fund our future infrastructure needs is overdue.  Better roads will reduce congestion in our cities and deliver national productivity and economic growth. Increased infrastructure investment is also central to efforts to reducing the number of crashes, deaths and injuries that occur on our roads.

“Just as reform has improved the way consumers can pay for services in the communications and energy markets, the time has come for a serious conversation regarding how the same can happen for Australia’s transport network,” he said.

“Fuel excise should be phased out as the primary source of revenue and replaced with a road user charge which would alleviate the regressive nature of the taxes on motorists and provide a clear link to the revenue raised and investment in infrastructure,” Mr Bradley said.

The AAA is also calling for abolition of Customs Duty and the Luxury Car Tax immediately.

“With no domestic vehicle manufacturing industry beyond 2017 there is no policy rationale to support the maintenance of these protectionist and inefficient taxes,” Mr Bradley said.

Read the full submission on our website: Submission to the Taxation White Paper


Related Documents