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Petrol to increase with GST, says AAA

Source: AAP | Published: Tuesday March 14, 2000

The GST would add at least two cents to retail petrol prices despite the government's promise of no fuel price hikes, the Australian Automobile Association said today.

Association executive director Lauchlan McIntosh said petrol costs would go up because the GST would feed into inflation and then petrol excise because it was linked to the CPI.

"So we expect that within six months of the GST coming in the CPI index will come up and then because fuel is automatically indexed, it will go up by another two cents," he said.

"The government has promised that fuel will not rise after the introduction of the GST; we believe that's a laudable promise but we'd like to see how they intend to do it."

McIntosh said the government would have to cut excise duty by at least 10 cents to compensate for the impacts of the GST, not including any oil price rises, and should stop indexing it to CPI.

"The government really has to seriously address the whole business of excise on petrol or it just becomes a creeping tax," he said.

The AAA is the national body of motoring clubs such as the NRMA and RACV.

http://www.theage.com.au/breaking/0003/14/A8273-2000Mar14.shtml

-- (Dee360Degree@aol.com), March 13, 2000