The Australian Trucking Association (ATA) has hailed the federal budget announcement to keep the industry’s fuel tax credits as a win for the trucking industry, but says the government should now look extending the temporary road user charge (RUC) that’s currently reduced to zero.
ATA Chair Mark Parry thanked the government for listening to the industry’s response to the Productivity Commission plan, which recommended phasing out fuel tax credits for on-road heavy vehicles over ten years.
“The ATA carried out a strong, evidence-based campaign to retain fuel tax credits, supported by detailed modelling,” Parry said.
“I’d like to thank Treasurer Jim Chalmers, Transport and Infrastructure Minister Catherine King and Assistant Climate Change Minister Josh Wilson for considering the industry’s views.”
The fuel tax credits system reduces the effective fuel tax rate paid by trucking operators, so they pay based on the cost of heavy vehicles’ use of the roads. This is called the road user charge.
The government has temporarily reduced the road user charge to zero in response to the Middle East war, but the charge is currently scheduled to go back to 32.4 cents per litre on 1 July – with the Federal Budget failing to mention any extension.
Parry said the fuel tax credit system has reduced the cost of freight for everyone in Australia, as well as our rural exporters.
“Removing fuel tax credits would increase costs for industry and hard-pressed Australian households, who face continued cost of living pressures as the effect of the high fuel prices flows across the economy,” he said.
“Removing fuel tax credits would also hit trucking businesses hard. They have already paid a 19 per cent increase in fuel tax over the last three years, and the cost of diesel has increased dramatically because of the war.
“Despite the industry’s success in arguing for support measures including the Fair Work Commission’s fuel cost recovery order, it will take many businesses a long time to recover.
“The government’s immediate focus should now be on considering whether to extend the temporary reduction in the road user charge for another three months.”
Parry added that the Productivity Commission’s plan would not achieve its goal of encouraging decarbonisation.
“Abolishing fuel tax credits would not address the engineering reality that there is no single technology available to replace diesel engines,” he said.
“Many regional communities rely on trucking operators to move and deliver all their daily necessities. Because this requires diesel engines, the commission’s approach would just be an unavoidable increase in tax.
“For those businesses that do have an alternative to diesel, the effective tax increase would reduce their financial capacity to invest in new vehicles and equipment.”
Extracted in full from: https://bigrigs.com.au/2026/05/15/fuel-tax-credits-to-remain-in-place/
