Prior to the GST introduction in 2000, the Federal Government promised the Australian electorate that ALL INDIRECT TAXES would be abolished. However, this was a massive and very deliberate lie.
In fact, although most indirect taxes were indeed abolished, the government very sneakily introduced a number of taxes to make up the shortfall in revenue that the GST would have created. For instance, the Wine Equalisation Tax was applied to wine, because the previous indirect wholesale tax reaped more revenue than the GST, so the government conned us all by imposing this tax when it promised to remove all indirect taxes.
The biggest con-job came with the imposition of GST on fuel that already had the fuel excise levied on it. Call it a different name and it's not a tax, the government said, but of course that is not true, because an excise is a tax in anybody's language. So hapless motorists found themselves paying GST on that fuel and fuel excise. What the government was doing was taxing a tax.
It is interesting to note that some of these taxes are actually illegal. Under current legislation, applying a tax on a product or service that is already taxed is against the law, so levying GST on fuel that is already taxed with an excise is blatant double-dipping and illegal, but the Federal Government has been getting away with this scam since 2000.
There are a number of other taxes that are obviously illegal, such as the Luxury Car Tax. Under the Australian Constitution that supersedes any other law, a tax on a tax is illegal, therefore a High Court action by all concerned parties should be launched to force the Federal Government to not only immediately stop applying GST on fuel, but to compensate all motorists for the years that they have paid this illegal tax.
Diesel-engined cars are becoming very popular. Of course operators of diesel-powered commercial vehicles in Australia have long enjoyed the huge savings on maintenance and economy that diesel offers. However, the one thing that sticks in the craw of motorists who drive diesel vehicles is the iniquitous price of this fuel over that of petrol.
These days, diesel fuel costs a lot more than petrol and it is interesting to note that when the price of petrol fell by around 50% from July to December 2008, the price of diesel fuel hardly moved. Petrol fell from $1.50 to under $1.00 per litre in six months, due to the world economic downturn, yet diesel fuel fell around 10 cents in that time.
Why is this so? For starters, diesel fuel is far cheaper to manufacture. It does not require the amount of refining that petrol needs to get the finished product. It is not a scarce commodity, as the Federal Government would have us believe, using this as an excuse for keeping the price high. In fact in most other parts of the world, diesel fuel is far cheaper than petrol, as in Europe and Asia. In the USA, diesel fuel is more expensive than petrol, because of the same lame excuses that the Federal Government makes here in Australia. It is interesting to note that in the USA, fuel taxes are around 16%, unlike the massive 30% or more in Australia.
There is no doubt that diesel fuel should be a lot cheaper than petrol, especially these days where more and more diesel-powered cars are being sold, which should make this fuel more competitive at the pump. Motorists should take action to force the Federal Government to firstly remove the illegal Fuel Excise and then stop pricing diesel fuel using the Singapore benchmark and use a more realistic way to price diesel fuel.