The Government's planned 2027 fuel excise increase is ‘pretty unlikely to go ahead’ - Transport Minister Chris Bishop says

It is “pretty unlikely” the next fuel excise increase will go ahead, Transport Minister Chris Bishop says, as petrol prices near $3.50 for 91.

“There's a range of things to do before we make that final decision,” Bishop said on Tuesday. “There are implications from delaying the increase to fuel tax by another year, it's not just new roads, it's existing road maintenance funding and public transport, for example, all of the things that that fuel taxes go towards.

“We're just going to work our way through that. And it's complicated… [I’ve] basically given a pretty good indication it's unlikely to happen.”

He said raising fuel tax by 12 cents in a fuel crisis was “pretty unlikely”.

The plan has been for excise to go up 12 cents in 2027, contributing funding to the Government’s transport promises. The Government is currently working its way through its transport commitments in light of the fuel crisis.

Bishop said the intention was to publish a new draft government policy statement on transport this year.

“That won't take effect until 1 July 2027, that sets the forecast funding range for the three and out years beyond that."

If he regretted not raising fuel taxes when coming into Government, Bishop said it was at a time when inflation was high.

“It was coming down, but it was still high, well outside the target band. And New Zealanders had been doing it really tough for a number of years, and it just seemed pretty mean spirited to slug them with another increase in their costs at that time.”

He said petrol tax had not risen since 2020 for a range of good reasons, “but fuel tax also is a user pays system.”

“It goes into the roads, maintenance, public transport, the new projects we want to build, the new public transport projects we want to build, all of those things have to be paid for.

“And the government doesn't have an unlimited credit card…”