Fuel excise returns with increased costs expected across the board

The Federal Government’s temporary fuel excise will end today, meaning an increase of 25 cents per litre at the bowser for consumers.

Introduced by the previous Government in March, the cut was designed to relieve the increasing cost of living and, according to the Government, cost $5.6 billion in lost revenue over the past six months.

For fuel retail operators, this means little immediately, but as the excise is re-imposed, the associated increase in GST will mean higher costs to be passed onto the consumer over the next few days and weeks.

Jim Chalmers, Federal Treasurer, said that prices will not rise immediately as most metro service stations across the country would have reserves of petrol to get through first.

“Industry estimates that there [will] be more than 700 million litres of lower excise fuel in the system when the fuel excise is reintroduced,” he said.

In anticipation of this announcement, the Australian Competition and Consumer Commission (ACCC) put major fuel wholesalers and retailers on alert, notifying them they won’t hesitate to take action should they make statements on price movements the ACCC perceives as misleading.

The commission, who monitors wholesale and retail fuel price fluctuations, says it expects no uncharacteristic or abnormal retail price increases in the days leading up to and just after the reintroduction of the full rate of fuel excise.

Previous to the excise cut, the impact of the war in Ukraine combined with a rise in international crude oil prices meat rising prices for wholesalers and retailers. Yet to be seen if this upward trend continues after the full excise in reintroduced.

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