Modeling shows what Perth households will actually save from fuel excise tax cut

When petrol prices hit a new record high in March, Western Australians struggling with the soaring cost of living were relieved by the decision to halve the excise tax on fuel for six months.

The Morrison government’s central budget announcement cut the cost of fuel by 22.1 cents a litre, with former treasurer Josh Frydenberg saying, “A family with two cars that fills up once a week could save around $30 per week or about $700 over the next six months. .”

But modeling undertaken by the University of Canberra indicates that the average household in WA will save nothing near the amount Mr Frydenberg announced.

The University’s National Center for Social and Economic Modeling (NATSEM) calculated that the measure would save the average household in Perth’s western suburbs like City Beach, Claremont and Subiaco less than $100 over six months.

Those in Perth’s inner suburbs like Victoria Park, Maylands and Tuart Hill would save between $100 and $150 and households in Perth’s outer suburbs including Lesmurdie, Bullsbrook and Serpentine would save between $150 and $200.

NATSEM keynote speaker John Hawkins said the calculations were based on the average results of all households, including those with only one vehicle or none.

Dr Hawkins said it was possible that some households could save $700, but it wouldn’t be much, as it would require them to spend well over $10,000 a year on gasoline, which equates to around 150 liters per week.

Most inland areas of Western Australia will save between $100 and $150, while areas closer to the coast will save between $150 and $300.

Tax relief benefits wealthier households

Although the excise duty reduction is being sold as a policy that would help those struggling to make ends meet, Dr Hawkins said the excise duty reduction has disproportionately benefited wealthier households .

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