National leader Christopher Luxon says taxes such as the Auckland regional fuel tax could be removed in order to help Kiwis at the pump.
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The price for 95 topped $3 a litre at some Auckland stations over Waitangi weekend, with prices very close to that mark in Wellington.
The Motor Trade Association has said not to blame retailers for rising costs, explaining 52 per cent of the cost consists of taxes such as fuel excise duty, Emission Trading Scheme levy and GST.
Thirty-seven per cent is made up of production and shipping costs, with the remaining 10.6 per cent as the wholesaler and retailer margin.
Luxon told Breakfast on Wednesday the Auckland regional fuel tax had raised more than $500 million since it began in July 2018.
However, he claimed half of it had been “under spent” and that it was “sitting in a bank account doing nothing”.
“That could be removed in order to leave Kiwis with more cash in their pockets for example. That’s the mentality.
“You’ve got to come to this place of what can you control as a government.”
“My challenge to the Government is if you woke up each morning and said, ‘how do you actually get it moving to reduce to the cost of living’ – why don’t you look at some tax components.”
Luxon claimed inflation had expanded the Government’s “tax take quite a bit”, adding the Government’s 68 per cent in spending was helping to drive prices up.
“There’s a really big moment in time now to really focus on this cost of living, look at spending and make sure the right programmes are being invested in but stop some of the stuff that’s not really working and fine tune some of that and just get the priorities straight now because it gets tougher later on if you can’t get that right.”
If National was in power Luxon said Government spending would be focused on “where it needs to be” and not on the “nice dos” such as Three Waters and light rail.
He said adjustments needed to be made now in order for hard choices and serious cuts not to be made down the road.
“That’s been our challenge and push to the Government. It’s going to get worse if we don’t make the decisions now.”
With construction costs rising by 6.1 per cent over last year, Luxon said National would look at the efficiency of ports, the use of alternative materials such as steel and changes to building code materials in order to alleviate the issue.
Luxon said National would make changes to compliance and amend recent credit crunches to help with home ownership.
He said he would also repeal interest deductibility.
For rentals, he said the party would incentivise developers to take part in “build to rent” programmes.
He added community providers such as the Salvation Army and Māori trusts needed to be involved in helping to address emergency housing shortages. Luxon claimed the Government was currently reliant on Kāinga Ora for this.
“The Government has a role to play to actually step in and make very targeted, powerful interventions. You can’t leave everything to markets.”
The Government has been accused recently of allowing inequality to grow.
Political and economic commentator Bernard Hickey claimed the Government’s policies, along with Covid-19, had seen those with assets have a “fantastic time” over the last 21 months, while renters and beneficiaries had “struggled”.
“So Covid for those people who own homes and shares has been absolutely fantastic. For those who are renters and who are on precarious incomes or maybe a benefit, it has been not just bad, but awful.”
Ardern has said her Government is “not giving up” on housing affordability.
“We have made progress. We are not giving up. We continue to do everything that we can, pull every lever we have, whether it’s changes to tax rules, whether its supporting councils with more infrastructure in the ground, creating progressive home ownership, creating transitional housing, supporting our social services … and building more public houses than seen in the last 20 years. We are doing all of that because we need to do everything we can if we’re going to change this market,” she told Breakfast on Tuesday.
“I don’t think either of us would argue that we don’t want a situation where home ownership slips out of the reach of New Zealanders. I see it as something that is core to us. It gives financial stability to people, it gives them anchor to a community. This is absolutely an ambition we have but today’s first home buyers, once they are in the market, we want to ensure we don’t have a housing crash.”
