Heavy vehicle road user increase to hit truckies, be passed on to industry

The government has flagged an increase to the heavy vehicle road user charge rate by 6 per cent per year over three years, equating to 18pc total.

That means it will go from 27.2 cents per litre of diesel to 32.4c/L in 2025-26.

The charge was introduced by the Howard government in 2006 and applies to heavy vehicles over 4.5 tonnes.

It is designed to recover some of the costs of road maintenance and construction particularly on regional and rural freight routes.

Livestock and Rural Transporters Association of Queensland president and Tambo transport operator Gerard Johnson said the increase was "disappointing".

"We agree that we must pay for our fair share of road maintenance and we've been calling for small increases for years so it didn't end up like it has now," Mr Johnson said.

"There's only so much we can absorb before we have to pass on the cost."

Mr Johnson said it was too early to tell how much extra farmers would have to pay to move cattle and grain but that it would happen.

A spokesperson for federal Transport Minister Catherine King said the National Transport Commission had consulted on either 6pc or 10pc cost increases and every state and territory transport minister decided for the first time to set the charge for three years to provide price certainty for the industry.

"Setting the charge for three years allows transport ministers the time to consider the best system for setting heavy vehicle charges, as requested by industry peak bodies," the said.

"It is important to strike the right balance between recovering the cost of heavy vehicle's share of road maintenance and construction and operators' ability to cope with price increases in consideration of the current economic climate."

They said truckies continued to be able to claim the fuel tax credit which returned about $8 billion to truck and freight companies each year.

The government insists the increase in heavy vehicle charges is not linked to the introduction of electric and hydrogen-powered vehicles.

Queensland Trucking Association CEO Gary Mahon said the announcement left truck drivers dismayed.

"[They're] just dismayed at yet another increase," Mr Mahon said.

"Six per cent is above average and we work in an industry with very, very tight margins.

"We've had the experience of Scott's Refrigerated Logistics - one of the biggest fleets in the country - going into liquidation in recent weeks.

"A certain amount of that related to the expectations of the sort of the margins that they are working with, which are continually being sharpened."

Mr Mahon said the margin for a well-run road freight business "was in the vicinity of four or five cents on the dollar".

"That's a very tight business margin compared [to] any industry and [when] you increase these costs the way that [the government] are, they'll be passed through to the consumer because our people just cannot absorb these continuous increases.

"Fuel in particular [has] absolutely leapt out of the blocks over the last 12 months, so I can't imagine there'd be any operator in the country these days that does not operate without a freight charge on the one hand, and a fuel surcharge separate to that."

AgForce said the move had significant implications for supply chains and rural communities.

"I think there were some real opportunities that have been missed and that's a real shame for consumers and our farming community," general president Georgie Somerset said.

"There are many examples in this budget of the government giving with one hand but taking with the other - it is really disappointing for Queensland agriculture."

Kennedy MP Bob Katter said one transport company he'd spoken to in North Queensland considered this proposed budget measure would increase its annual costs by $461,000.

"Transport companies cannot, and will not, afford this cost and will have to pass on the charges to their customers - farmers and small businesses," he said.

Mr Katter said an increase in transport costs would not only increase transport costs for farms but also increase the transport-related fertiliser and packaging costs - leaving nothing for the farming families.

"Either the consumer pays more for Australian fruit and vegetables or farmers walk off the land and small business will shut," he said.

"Something must give, either government reverses this insidious charge, or transport companies, farmers and small business go bust, or we all pay more at the checkout.

"The headline cost-of-living budget measure, the $500 in relief to our hip pocket will last less than a week - what about the other 51 weeks?"

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