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Australian treasury envisages decongestion in major cities

Australia: As part of his review into the Australian taxation system, Treasury Secretary Ken Henry said that GPS technology could be used to charge road users a congestion tax in Australia’s major cities.

The review projected that by 2020, the cost of city congestion will reach USD 20 billion. To ensure investment in roads and transport as well as maintain liveability in metro areas, Henry recommended congestion taxes in major city areas rather than an increase in fuel taxes across the board. The taxes would be location-specific and vary in price depending on the time of day.

The review stated that new technologies would enable greater use of user charging to address “social spill-over costs”. According to the review, electronic tagging and GPS technology in vehicles will allow congestion charging in city areas, as well as charging heavy vehicles for normal road use.

There is no indication in the Federal Government’s response to the review that it plans to implement a congestion tax in any of Australia’s major cities.

Source:  ZDNet