Kevin Clancy by

Year 12 English - Formal Writing

In the recent months petrol prices have skyrocketed to all-time highs. Understandably, Kiwis are upset at the extortionate amounts we are paying at the pump.

Many blame the government. Prime Minister Jacinda Ardern has responded to the public outcry by placing the responsibility on oil companies. According to Ardern “consumers are being fleeced at the pump.” Fleecing is a very appropriate term here, but who is shearing the sheep?

It’s the government. Not just this current coalition, but also National, who whilst in power, saw taxes on petrol raised by 17 cents. The latest available figures from the AA show that when you last bought petrol, on average you paid 70 cents per litre in excise tax. Add another 10 cents on for GST and voilà, 80 cents of what you pay for a litre of petrol goes straight into the government’s pocket. Sadly, the misery doesn’t end there. The coalition plans to add a further 10.5 cents in excise over the next two years.

This rank inflation of taxes and subsequent rise in the price of petrol is hitting Kiwis hard. Especially affected are the poor who, while already struggling to make ends meet, face yet another financial challenge. This is made worse by the fact that Labour is doing nothing of merit to fix a problem they are contributing to. Labour claim to be committed to eradicating poverty, however their tax policies only serve to keep the poor on the back foot.

Many would argue that the taxes are necessary to keep our roads in working order and to provide new, better transport services. To a certain extent, this is correct. However, the taxes don’t need to be nearly as steep and the capital needed to keep our roads in running order can be sourced from other areas without sucking yet more hard earned cash away from New Zealand battlers.

But where would this money come from? There is an extensive list of irresponsible and unnecessary government spending that can be re jigged to fill any void left by petrol tax cuts. For example the government are spending $100million on the America’s Cup as well as millions more in subsidies for foreign studios to make films in New Zealand. Do we really need to be paying for these things? Here are 3 alternatives to our wallets the government can source capital for road and transport.

Firstly, the government are running a hefty cash surplus of $5.5billion. The fact that the government have an excess means we’re being taxed too heavily as there is a great deal of money left over at the end of the day. Regardless, this money should to be reinvested immediately to offset the burden on the New Zealand road users.

Foreign aid is another area that can be slashed. Over the next four years, our government will squander $714 million dollars by handing it out like candy to foreign countries, mainly in the Pacific. Why is the already struggling New Zealand taxpayer footing the bill for various Pacific nation’s cash needs? Parliament needs to put their foot down and tell these leeches to pay their own bills. The government of New Zealand’s main responsibility is to the people of New Zealand, not Niue or Tuvalu. We are being neglected by our government who favour the appeasement of foreign nations over the welfare of its own people. This disgusting waste of taxpayers’ money needs to be curtailed with immediate effect and reinvested at home.

The government have scored a massive own goal by banning oil and gas exploration. According to the of Ministry of Business, Innovation and Employment, our current coalition’s genius decision to ban future oil and gas ventures in New Zealand will result in a whopping $8 billion lost in future tax revenue. While this decision will also limit future economic growth, it will also mean there’s $8 billion dollars down the drain. This is $8 billion that could, among other things have been used to limit the the government’s thirst for high excise tax on petrol.

Those are just three places our government could look to relieve the heavy burden of excise tax. It doesn’t have to stop there either. There is a myriad of other bits of useless spending the government can slash as well as more cash that can be reassigned. If finance minister Grant Robertson took my three steps right now, overnight we would have $6.2 billion extra to replace excise tax. This isn’t including the $8 billion in oil and gas tax revenue that would be earned in the long term.

Yes, Jacinda, we are being fleeced at the pump. However, it is clear you are the sweaty farmer extorting our money from us. It doesn’t have to be this way. If the government follow the three simple steps I have outlined, in the long run, New Zealand will have $14.2 billion to throw at roads and transport. This in turn means the excise tax on petrol won’t need to be nearly as heavy as it is and kiwis will have far more breathing space when it comes to monetary needs. 

This has been written in the style of an opinion piece suitable for a newspaper.