Motorists should not expect another cut to the fuel excise any time soon as other areas of cost of living relief remain the priorities.
The federal government has been under pressure to help financially stretched households but its mid-year budget update contained no new direct measures or handouts.
Treasurer Jim Chalmers said it was never the intention to hand down a “mini-budget” and announce major policies, though he has kept the door open to more cost of living relief in the 2024 budget if required.
Temporarily slashing the fuel excise tax, which was done last year after the Ukraine war sent petrol prices soaring, is unlikely to be considered given prices swing wildly due to fluctuations in global oil markets.
“Our focus is elsewhere when it comes to cost of living,” Dr Chalmers said.
He said oil prices had already been moderating after a spike in the September quarter sent prices at the pump surging, with the slowdown to flow through to motorists in time.
Labor’s cost of living response will remain focused on areas that would make a “meaningful difference” to inflation, such as electricity, childcare and rent.
A cost of living relief package was announced in the May budget, including energy bill help and cheaper medicines.
The decision to bank most of the upward revision to revenue from a higher-than-expected corporate and individual tax take was also expected to take pressure off inflation, the treasurer said.
The surprise revenue boost has narrowed the forecast deficit for 2023/2024 to $1.1 billion, and within “striking distance” of a surplus.
The opposition said Labor should be doing more to help the Reserve Bank bring consumer price growth back within the two-three per cent target band.
Shadow treasurer Angus Taylor said the government should be pulling every lever at its disposal to bring down inflation.
“Spending in particular is important, you don’t tax your way out of a cost of living crisis,” he told reporters.
He said cost of living support measures would target symptoms of inflation when it was important to tackle price pressures at the source.
“The greatest cost of living support is to get inflation down.”
Anglicare Australia executive director Kasy Chambers said targeted cost of living relief would not add to inflation, unlike the stage three tax cuts.
“That means giving hundreds of billions of dollars to people who don’t want or need it – which could push up living costs for everyone else,” she said .
The income tax cuts are set to take effect in mid 2024.