Fuel Prices to Increase as Government's Excise Cut Ends

Topic: Oil and Gas

Sun 2 Aug 2026 at 4:38am

Mon 3 Aug 2026 at 12:00am

The government cut fuel taxes to help people with high living costs.

Fuel prices will go up because the government's tax cut is ending.

The tax rate will also go up because of inflation.

From April 1, the fuel tax was lowered from 52.6 cents to 20.6 cents per liter.

The tax cut was extended to August 2, but the rate went up to 36.6 cents per liter.

This was part of a plan to help Australians and make sure there was enough fuel.

The Treasurer said the tax cut will end at midnight.

The tax cut helped people with high living costs.

The government never meant for the tax cut to be permanent.

What is the fuel tax?

The fuel tax is a sales tax on petrol and diesel.

The tax is paid by fuel importers and sellers, and then passed on to consumers.

The tax is adjusted twice a year.

After the last adjustment, the fuel tax was 52.6 cents per liter.

How has the tax changed?

Price changes won't happen right away

A motoring group spokesperson said prices at the pump may not rise immediately.

It took about a week for the price change to happen last time.

The wholesale price of petrol will go up to about $2 per liter.

The wholesale price of diesel will go up to about $2.35 to $2.40 per liter.

After the next adjustment, the tax rate will go up to about 53.7 cents per liter.

Economists don't think the tax cut was a good idea.

The tax cut was predicted to cost $2.55 billion and could increase inflation.

An economist said interfering with fuel prices is not the best way to help people.

Lowering the price doesn't encourage people to use less fuel.

The economist said there are better ways to help people.

A motoring group spokesperson said the tax cut was helpful, but the tax is important for the government.

The government gets a lot of money from the fuel tax.

It's a hard decision for the government to make.