The fuel tax credit is critical to the competitiveness of a diverse range of regional businesses reliant on diesel including Australia's minerals industry, agriculture and tourism.
Fuel taxes are meant to pay for roads.
When trucks and cars use public roads, they pay fuel excise to help cover maintenance.
Yet miners, farmers, fishers, tourism operators, and businesses using fuel off-road don't use public roads, so shouldn't pay a road tax.
The fuel tax credit fixes an unfair tax by refunding the road tax for fuel that isn't used on roads.
The MCA appreciates the public support by senior Ministers in the Federal Government for retention of the fuel tax credit.
Along with other regional industries, the MCA has campaigned for some years to retain the fuel tax credit in its current form.
Ill-informed and misconceived attacks on the fuel tax credit, which according to reports today are being reheated in advance of the Federal Budget, are a direct attack on regional businesses and jobs.
If fuel tax credits are scrapped, some of Australia's most remote communities would face financial hardship and all Australians would face higher prices, job losses and weaker local businesses.
Claims that fuel tax credits are a subsidy are incorrect.
A subsidy means the government is handing out money. Fuel tax credits don't do that-they just stop businesses from paying a tax they don't owe.
The Treasury has previously stated in a submission to the G20 Energy Experts Group: "Fuel tax credits are not a subsidy for fuel use, but a mechanism to remove an unfair tax on off-road fuel users."
The minerals industry will fight hard for regional businesses and regional jobs who are being targeted by this misleading campaign.
