States and Territories strike deal to waive $400 million of GST to help with fuel crisis

Petrol and diesel prices should fall another 5.7¢ a litre after State and Territory leaders struck a deal to waive extra GST worth an estimated $400 million and use it to further reduce fuel excise.

WA Premier Roger Cook is chairing the Council for the Australia Federation and confirmed the deal on Thursday after four days of negotiations.

“State and Territory leaders were united today in our desire to assist the Prime Minister to deliver real relief at the bowser,” he said.

“We know the price of petrol drives up inflation through higher transportation costs for almost everything else in our economy.

“Putting downward pressure on the price of petrol puts downward pressure on the price of food and costs for business.

“As the Prime Minister said last night, the next few months may be difficult but we’ll get through it with the community, industry and all levels of government working together.”

Mr Cook declared a state of emergency under WA’s Fuel, Energy and Power Resources Act on Wednesday, compelling fuel companies to hand over information about their supplies after three companies refused.

It is the first time those powers have been used but Mr Cook said imposing a a permit or rationing system would not be included in the regulations.

“We are utilising the emergency powers under the Fuel, Energy and Power Resources Act,” he said.

“It’s very specific powers, powers that we need in order to create some transparency around fuel supply.”

The full impact of the fuel excise cuts is not expected to flow through until next week, even as economists warn the benefit could be outpaced by rising global oil prices as the standoff in the Strait of Hormuz continues.