Revise rates now, ATA advises

ATA chief executive, Stuart St Clair

Trucking businesses should review their costs and freight rates ahead of the introduction of the carbon tax and the 2.4 cents per litre increase in their fuel tax on  July 1, advised Stuart St Clair, chief executive of the Australian Trucking Association (ATA).

Although trucking firms will not pay carbon tax on the fuel they use on public roads for another two years, they will still face increased costs from July 1 this year as their suppliers increase prices.

“Like every other business, trucking companies should review their costs and make a judgement about whether they are likely to increase as a result of the carbon tax,” St Clair said. “With less than a month to go before the introduction of the tax, it’s time for every trucking business to talk to their accountant and go over the books.

“The tax is likely to have a particularly large impact on trucking firms that operate cold stores, because electricity typically accounts for about 30 percent of their costs.

“In New South Wales, electricity prices are set to rise 16 percent on average, with nine percentage points of the increase coming from the carbon tax. Businesses will need to take this cost increase into account, as well as the substantial increase expected in the cost of refrigerants.

“Trucking businesses offering intermodal services will also face cost rises, with Pacific National rail and the Spirit of Tasmania ferry service imposing respective surcharges of 1.34 and 2.04 percent.”

Stuart also reiterated that trucking businesses will face a 2.4 cents per litre increase in their effective fuel tax from July 1, while many registration charges will also increase on this date.

“The fuel tax and registration charge increases will cost a typical owner-driver about $2800 per year,” he stressed. “For a trucking business with 10 prime movers and semi-trailers, the cost increase is likely to be about $41,800 per annum.

“Every trucking business needs to talk to its customers about increasing freight rates or adjusting fuel surcharges. It’s a hard ask, but the industry’s customers need to understand that our costs are going up and we cannot absorb them,” he concluded.

 

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