The Government has introduced legislation designed to take the "first steps" towards replacing the petrol tax with road user charges for light vehicles.
The Land Transport (Revenue) Amendment Bill, aimed at "taking the next step towards a fairer, simpler, and more modern transport funding system", has been introduced to Parliament.
It proposes several changes to both road user charges and tolling frameworks.
Transport Minister Chris Bishop explained that it was about "ensuring New Zealand is ready for the next generation of road building".
It included changes to the road user charge system, which Bishop described as an "outdated" 1970s-era system that still relied on manual paperwork and paper licenses.
“Right now, drivers paying RUC have to track their odometer readings and stick paper labels to their windscreen," he said.
“This Bill enables new payment models like subscriptions or post-payment, and allows private companies to offer easy, set-and-forget billing options - similar to how many of us already pay for power or streaming services.
Government has signed off the first steps towards scrapping petrol tax and shifting all vehicles onto electronic road user charges. (Source: 1News)
He also said it would "future-proof" the system to allow in-vehicle technology to record distance and would separate the New Zealand Transport Agency "from its retail role so third-party providers compete on a level playing field".
“These changes are the first step towards replacing petrol tax with RUC for light petrol vehicles," Bishop said.
"We’ll assess the improved system in 2027 before deciding on next steps for transitioning the remaining 3.5 million vehicles.”
Currently road user charges apply to all diesel vehicles, heavy vehicles (over 3.5 tonnes), and light electric vehicles, including plug-in hybrids.
Proposed changes to tolling were also included in the legislation.
"Corridor tolling" would be enabled, allowing tolling on parts of an existing road where "users receive clear, demonstrable benefits from a new project in the same corridor".
“The Bill also introduces new tools to manage diversion from toll roads, including the ability to restrict heavy vehicles from using unsuitable alternative routes, and allowing toll revenue to help fund maintenance of alternative roads when councils are unable to do so."
The Bill also mandated annual CPI increases to improve collection efficiency, as opposed to ad-hoc increases. It also aimed to improve collection efficiency and shift liability for tolls from the driver to the registered person.
“These changes will give us a more consistent, more flexible tolling framework so that we can deliver big road upgrades faster and support regional economic growth,” Bishop said.
Following its first reading, the Bill will go before the Transport and Infrastructure Select Committee.
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