Colin Ambler/cvnznews.com
Prime Minister Christopher Luxon said on NewstalkZB this morning there are “no red flags” over New Zealand’s fuel supplies — but confirmed motorists will still face higher fuel taxes, despite National’s promise of no new taxes in the next term. The government has announced it will delay scheduled fuel excise increases by one year, shifting the cost burden but not removing it. Labour, meanwhile, has pledged not to raise fuel tax at all for three years.
Under the original plan, fuel excise was set to jump 12 cents on 1 January 2027, followed by further increases of 6 cents and 4 cents heading into 2029 — a total rise of 22 cents. Instead, the government will introduce smaller increments of 5 cents every six months beginning in 2028, totalling 20 cents by the end of 2029.
Transport Minister Chris Bishop said the delay requires a major “top‑up” to the National Land Transport Fund (NLTF) to avoid “significant cuts” to road maintenance, public transport and infrastructure investment. The government will inject $1.476 billion over the forecast period, partly funded by the $450 million “fuel crisis rainy day fund” created in this year’s Budget. The remainder will be sourced from other areas of the government’s books.
“We’re giving motorists a full year without the fuel tax increase they were expecting, while protecting investment in our transport system,” Bishop said.
Luxon rejected suggestions the upcoming election influenced the decision. He said the Iranian fuel crisis and global volatility made a January 2027 rise “unlikely” and the government had simply responded to changing circumstances.
Labour last week promised to freeze fuel tax for the entire next term. Bishop accused the party of “hoping for the best,” saying its plan would leave a $4.6 billion hole in the NLTF. He said the additional $1 billion needed to cover the delayed tax rise will be detailed in the pre‑election fiscal update.
