Australians have been told to brace for petrol price hikes over the coming weeks and months as the fuel excise cost returns to its pre-cut levels from September 28.
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For the past six months, motorists have been shielded from the full cost of a tank of petrol, after the former Coalition government halved the excise.
But from September 28, the excise cost is set to return in full.
So when will those changes be felt, and how much are you now going to be paying for petrol?
What is the fuel excise?
Put in simple terms, fuel excise is the federal government's sale tax.
The funding raised from this tax is collected for the government's general revenue.
In March, when the Morrison government decided to halve it, the excise cost was 44.2 cents per litre. So, for the past six months, Australians have been paying 22.1 cents per litre.
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Why did the Morrison government halve the excise?
Cast your mind back to March, if you can. Do you remember what was looming large over the Morrison government? The May 21 election. It was front of mind for the federal government.
Combine that with the soaring inflation rate and the rising cost of living, and you've got yourself a political powder keg.
Plus, externally, the world was bracing for supply chain disruptions with the war in Ukraine and the ongoing COVID-19 pandemic.
The government was under a lot of pressure to do what it could to ease the cost of living for Australians.
So, the excise was halved from the full 44.2 cents per litre, to the 22.1 cents per litre.
But did it make much of a difference? Back in June (so, three months after the excise cut and one month after the Labor government was elected), petrol prices continued to stay above $2 a litre across the country.
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Speaking to ACM at the time, Associate Professor Liam Wagner, energy and economics expert from the University of Adelaide described the fuel excise cut as "entirely reckless".
"It's a bit of a paradox, you've suddenly given people a considerable discount to their fuel of around 10 per cent at the time," Professor Wagner said.
"So you know, I would expect demand to then go up to be able to meet with that new, much lower price and once the price returns to where it should be with the removal of the discount for the excise, I suspect demand will significantly drop.
"When the excise is brought back to its full force we'll likely see at 20-odd cent jump overnight in petrol prices."
Why is the excise coming back?
The cost of living crisis isn't over, and the inflation rate has not been brought down.
Now with rising interest rates as well, there have been many calls for the new Labor government to continue to halve the excise.
But federal Treasurer Jim Chalmers has made abundantly clear that this is not a viable option.
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The excise cut costs the federal government $3 billion and the nation is facing a budget deficit "north of $30 billion" according to the treasurer.
"There will be difficult decisions in the October Budget," Dr Chalmers said in a press conference on September 20.
"And one example of a difficult decision that we've had to take has been to stick with our predecessor's timing for the end of the petrol excise relief.
"We are under no illusions that this will be difficult for people."
How much will the excise be now?
When it was halved, the excise was 44.2 cents per litre. But the inflation rate has changed since March. It now sits at 6.1 per cent.
So, according to the Consumer Price Index (CPI), the fuel excise cost will now be closer to 46 cents per litre.
"I think most people understand that the Budget can't afford to keep the excise cut going forever," Treasurer Jim Chalmers said.
"And people are preparing for the fact that we'll return to its normal setting."
Will prices jump up over night?
Well, it shouldn't.
Treasurer Jim Chalmers told the nation that there currently are 700 million litres of lower excise fuel "in the system".
"This is 700 million reasons why the price shouldn't shoot up by the full 23 cents on the night that the excise relief ends," Dr Chalmers said.
"We've been working closely with the servos and suppliers to understand that there are hundreds of millions of litres of fuel underground in tanks that was purchased at the lower price."
Retailers have also been put on notice by the consumer watchdog to avoid price gouging to make a quick buck when the excise cut expires.
"The government expects that the price of petrol shouldn't shoot up at the bowser on Wednesday night by the full 23 cents, if the normal market pressures are in operation," Dr Chalmer said on September 20.
"This is why we've maximised the ACCC's [Australian Competition and Consumer Commission] role in monitoring the petrol situation as this petrol price relief comes off."