The Australian Government should freeze the trucking industry’s road user charge in the 2015-16 Budget, the ATA has said in its 2015-16 pre-Budget submission.

The trucking industry pays for its use of the road through heavy vehicle registration fees and a road user charge on fuel, currently 26.14 cents per litre. The industry has been overcharged since 2007 because this system underestimates the number of trucks on the road.

In 2014-15, the trucking industry was overcharged by more than $200 million.

The independent body responsible for setting the road user charge, the National Transport Commission, last year recommended changes to the way this charge is calculated to eliminate over-recovery. The state transport ministers put off implementing the NTC recommendations until 2016, although the Australian Government acknowledged the over-recovery and decided to freeze the road user charge in 2014-15.

As a result, the Government should continue to freeze the road user charge until this overcharging has been addressed.

The submission also recommends the Government should increase the small business threshold from $2 million to $3 million, and investigate the possibility of an increase to $5 million.

 The Board of Taxation has acknowledged that the small business threshold has not been updated since 2007 and is outdated.

The current ATO definition of a ‘small business’ - a business with a turnover of $2 million (excluding GST) or less - does not cover many trucking operators who would otherwise be considered a small business because they employ fewer than 20 workers.

These businesses have a high turnover by small business standards but low margins. They may not possess sophisticated resources to deal with tax administration requirements. Raising the small business turnover threshold to $3 million, with the possibility of extending it to $5 million, would reduce the red tape and tax compliance costs faced by these businesses.