Government delays fuel tax increase to 2028, will borrow to cover shortfall
The Government scrapped a planned 12c fuel tax hike for January 2027, replacing it with smaller 5c increases starting in 2028 and funded partly through borrowing.
The Government has cancelled the 12-cent fuel excise increase scheduled for January 2027, replacing it with a series of smaller 5-cent per litre rises beginning in January 2028 and continuing at six-month intervals. To cover the revenue shortfall, the Government will top up the National Land Transport Fund with $1.476 billion, drawing on a $450 million fuel crisis fund and borrowing the remainder. Both major parties are now trading accusations over transport funding, with Labour pledging to freeze fuel taxes for a full three-year term if elected, while the Government argues this approach would damage the transport network.
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What outlets are saying
Stuff
Luxon to announce decision on fuel tax increase
A decision on whether to hike fuel taxes was being discussed around the Cabinet table on Monday,
NZ Herald
Election 2026: Govt to announce fuel tax decision as key deadline passes
The Government has previously said a fuel tax decision must be made by the end of August.
Newstalk ZB
Election 2026: Govt to announce fuel tax decision as key deadline passes
The Government is set to announce its decision on delaying next year’s 12c hike to fuel taxes and an equivalent hike to road-user charges.
1News
Govt scraps 2027 fuel excise increase, smaller rises from 2028
Prime Minister Christopher Luxon said a 5c per litre rise would instead begin in 2028, backed by a $1.476b top-up to the National Land Transport Fund.
BusinessDesk
Government hits the brakes on next year’s fuel-tax rise
The Government has scrapped a plan to hike fuel taxes next year, saying the rise will instead happen in 2028. Fuel excise duty will now rise by 5 cents on January 1 2028, followed by three further 5-cent increases at…
interest.co.nz
Inside the Capital: Fuel tax hike and RUC increase off the table, but where's the money coming from?
Fuel tax hike and RUC increase off the table for 2027, but where's the money coming from?
Newsroom
National and Labour’s fuel tax squabble puts NZ on a road to nowhere fast
Comment: For the better part of a decade, politicians have sold the public the fiction that we can build things without paying for them The post National and Labour’s fuel tax squabble puts NZ on a road to nowhere fast…
The Spinoff
A race to the bottom? The government delays fuel tax increase, Labour promises to freeze it
The government has cancelled a planned 12c per litre fuel excise increase due in January. Labour has promised no fuel tax increases for a full three-year term. National and Labour are now accusing each other of leaving a hole in…
Otago Daily Times
Labour's fuel tax freeze plan lacks cost details
Newstalk ZB
Terry Collins: AA Fuel Spokesperson on the Government pushing back and reducing the fuel tax hike
The Government's being criticised for giving the country the run-around with next year's fuel tax.
Newstalk ZB
Kerre Woodham: Hiking the fuel tax would take political courage
It's not often you hear people moaning that taxes should be put up, but we live in interesting times, people. Prime Minister Christopher Luxon and Transport Minister Chris Bishop yesterday announced that the Government had scrapped the 12 cents per…
Stuff
Government’s fuel tax cut leaves $1b hole they will borrow to fill
Government ministers have admitted the changes to upcoming fuel tax increases will mean extra borrowing.
interest.co.nz
The pickle of paying for freezing fuel tax rises
Parliament's funding problem: The pickle of covering the cost of not increasing fuel taxes