WA farmers reject Federal Government’s fuel tax to prop up refineries

WA farm groups plan to dig in against a proposed new fuel tax aimed at keeping Australia’s three remaining refineries open to shore up the nation’s fuel supply. Reports this week suggested the Federal Government would fund the new 1c/litre production payment until July 20201, when a new market mechanism would be introduced to charge the levy to petrol, diesel and jet fuel users. The move follows BP’s October announcement it would close its Kwinana refinery, leaving WA reliant on imported fuel, while raising fears over the future of the remaining three on the east coast. The National Farmers Federation and Minerals Council of Australia said their members should be exempt from the payment, as they were from the rebatable 42.3c/l fuel excise designed for road users. Tony Seabrook, president of the Pastoralists and Graziers Association of Western Australia, said while it was vital to keep Australia’s refineries open, in the first instance the Government needed to address the challenges they faced. He said if it was determined further money was needed, it should be funded from the current fuel excise. WAFarmers chief executive Trevor Whittington said Governments should resist solving their problems with new levies. “If the Feds want to underwrite petroleum refineries they should fund it from consolidated revenue or borrowings as they do with every other industry support program,” he said. Mr Whittington said the Government should be taking a closer look at why the refineries had failed. “Imposing a levy to prop up unprofitable refineries without looking at all the factors is lazy politics,” he said. Australian Agriculture Minister David Littleproud said in a Sky News interview there would be a consultation process with Energy Minister Angus Taylor. Mr Littleproud said a larger fuel supply in Australia would add to competitive tension, putting downward pressure on prices. “We’ve also got to appreciate the fact that there’s a 42.3c/litre rebate that goes to our mining and agricultural sectors at the moment,” he said. “I think what the Energy Minister needs to work through, in consultation with the agricultural sector and the minerals sector, is an understanding and appreciation of making sure that whatever is instituted, that it's done fairly, and that we make sure that no one is disadvantaged beyond anyone else. “But ultimately, someone always has to pay, and the Australian taxpayer only has a finite amount of resources in which they can provide.”