Motorist Fuel Pricing FAQs
Taxes represented around 34% of the retail price for petrol in Australia and about 33% of the cost of diesel. This is made up of:
The Australian Government applies an excise for every litre of petrol and diesel sold. The excise has been 38.143 cents per litre for a number of years. Excise on petrol was introduced in 1929. It was increased in line with inflation twice a year from 1983 until March 2001 when it was frozen at 38.143 cents per litre. The Australian Government announced in 2014 that the excise on fuel products would again increase in line with inflation, or the Consumer Price Index (CPI). Excise was indexed in November 2014 and February 2015 and is intended to be adjusted in February and August each year.
The Australian Government also applies a 10% goods and services tax (GST) to the sale of all fuel products. The amount of GST in a litre of fuel can be calculated by dividing the pump price by 11. For example, the GST included in a pump price of 132 cpl is 12 cpl.
The ACCC found in 2014 that: in many regional locations there is a lag between movements in capital city prices and local prices. This lag arises because the turnover of petrol stocks is generally lower in the country than in the capital cities due to lower volume of sales in regional areas. As a result, price changes in the five largest cities often take longer to be passed on to regional locations. This lag occurs both when prices are increasing and when they are decreasing."
This lag between city and regional prices (both up and down) was again seen in early 2015, as outlined in this ACCC report
The international benchmark price and taxes (excise and GST) collectively made up 88% of the petrol price paid by motorists and 87% of the diesel price in 2014. These two components are outside the control of local fuel retailers. The remaining 12% covers the cost of transporting, storing and retailing the fuel, including a small profit for the retailer. Real unit net profit on petrol products in the retail sector - i.e. how much the retailer made once all operating costs are deducted - was on average just 2.22 cpl in 2013-14.