World oil prices have been dropping steadily, but don't expect to see it at the pump - because it's clear that if GOB cannot get its tax bite in one area, it will surely get it in another. And tonight that other place seems to be at the gas pump. 7NEWS has confirmed that the cost price for gas has dropped sharply, more than half a dollar per gallon, but government is scooping it all up as a tax windfall. Typically, with such a sharp drop, the likes of which have not been seen in over a year, government would pass on some savings to the pump resulting in lower prices. But not this time, and looking at the numbers, we can see how this might make sense for the managers of the cash strapped coffers.
The cost price, per gallon, of premium gas went down by $0.57 per gallon; regular went down by $0.52 per gallon; and diesel by $0.39 per gallon. When government decides not to pass any of this one, it scoops up an increase of $2.97 per gallon in tax alone on diesel, a 120% increase. The tax on premium fuel will go up by 16% bringing it to $4.48, while on regular it increases by 14% bringing it to $4.25. The new prices, which again will see no changes at the pump, go into effect tonight at midnight.