Opposition “misguided on microeconomic reform”

An increase in taxes on heavy vehicles would be “one of the easiest” solutions for land transport reforms, said treasury secretary Ken Henry.

Dr Henry, delivering a speech entitled "The Policy Requirements of the Terms-of-Trade Boom" to economists in Sydney, has criticised the Opposition’s recent decision to disallow the regulation to increase the road user charge for heavy vehicles from 19.63 cents to 21 cents per litre from next year.

The voted-down legislation was recommended by the National Transport Commission, and has been endorsed by the Australian Transport Council.

Dr Henry said while this year would be a relatively “enlightened period for microeconomic reform” with the rich COAG agenda being devised by Australian governments, politicians have failed to recognise the importance of the heavy road users charge policy. 

He said: “The road user charge for heavy vehicles is not the most important structural policy matter likely to confront the nation’s parliaments this year. But it would be one of the easiest. And it is a pre-condition for other, more important, land transport reforms.

“If this terms-of-trade boom is going to have a happy ending, we are going to have to do better than this – a lot better.”

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