Officials warned against delaying fuel‑tax rise
Tuesday, 23 June 2026
Government officials advised ministers not to delay scheduled fuel-tax increases, warning the move would largely benefit large fuel users rather than ease cost-of-living pressures.
Despite that advice, the Government is still signalling the hikes will not go ahead as planned and Labour has said it definitely would not put them up if elected in November.
Fuel excise duty tax (FED) and road user charges (RUC) make up about 70 cents of every litre of petrol or diesel, funding the the National Land Transport Fund (NLTF) for road maintenance and upgrades.
Under current settings, FED is due to rise by 12 cents a litre in January next year, followed by a further 6-cent increase in January 2028 and another 4 cents in 2029.
Documents released under the Official Information Act show that on April 1, 2026, Ministry of Transport officials advised against delaying the increases.
They warned that delaying increases or reducing FED and RUC would benefit the biggest fuel users rather than those facing the greatest cost of living pressures.
Read more:
Fehi Fineanganofo, Josh Moorby, Xavier Numia, Anton Segner earn All Blacks call-ups
National embrace of compulsory KiwiSaver could make a new NZ capitalism
Last week Transport Minister Chris Bishop said it was “unlikely” the Government would go ahead with the planned fuel tax increases.
On Monday he told The Post he had nothing further to add to his previous comments.
Labour’s transport spokesperson, Tangi Utikere, said his party would help New Zealanders feeling “pain at the pump”.
“Kiwis need certainty right now and that's what we have provided in ruling the increase out.”
Green Party transport spokesperson Julie Anne Genter agreed with the advice from the Ministry of Transport.
“The land transport system is struggling for funding, and that will only get worse because of the Government’s ideological commitment to the extremely expensive roads of national significance programme.
“They cannot both deliver hugely expensive roads and refuse to increase fuel excise and road user charges to pay for them.”
In April The Post reported David Seymour wanted the taxes to go up as planned, but understood why some people did not.
“I understand the agony that people are facing that's driving these requests, but if we have roads being cancelled, maintenance being cancelled, roads full of potholes, if we borrow money to try and prop that up and leave debt and inflation for the next generation, or even just the next few years, that is also a failure that we have to balance.”
In that same report Bishop told The Post that given the pressures facing the NLTF, officials had advised him to keep the tax increases and even put them up more than what was currently planned but he did not have a “death wish”.