Who can currently claim a refund for fuel used off-road?

People who use fuel off-road may apply for a refund of fuel excise duty and a rebate of regional fuel tax in specific situations, including for fuel used:

  • in an exempt vehicle, mainly vehicles exempt from the motor vehicle licensing requirement, farmer’s vehicles or agriculture vehicles
  • in a licensed vehicle, specifically petrol vehicles that weigh over 3.5 tonnes subject to road user charges
  • in a commercial vessel, including in a dedicated maritime rescue vessel used for search and rescue purposes
  • for a commercial purpose (but not in a motor vehicle, vessel or aircraft), for example fuel used in a commercial electricity generator, portable light-towers and in the construction industry.

If you use fuel in any of these situations, you may be entitled to claim a refund for the fuel excise duty on the petrol you have used. If you purchased the fuel in Auckland, you may also be entitled to claim back the regional fuel tax on the petrol and diesel you have used. Claims for the refund of fuel excise duty and rebate of regional fuel tax are handled by Waka Kotahi the NZ Transport Agency. Further information on applying for a fuel excise duty refund may be found here(external link) and for a regional fuel tax rebate here(external link).

Why did you review the situations where some may claim a refund or rebate?

Following the introduction of the regional fuel tax in Auckland, we reviewed whether additional off-road users of fuel should be able to claim a rebate for the regional fuel tax. This was necessary as regional fuel tax, unlike fuel excise duty, also applies to diesel and we know that diesel is used more widely off-road than petrol. To ensure alignment, we also reviewed the fuel excise duty refund entitlements at the same time.

What did the review find and what was the review’s outcome?

As a result of this review, new entitlements were created for the rebate of regional fuel tax, for:

  • diesel used for home heating
  • fuel used in a dedicated off-road vehicle
  • other specific off-road situations relating to regional fuel tax (for example, when fuel is transported outside Auckland).

We also explored new entitlements for regional fuel tax and fuel excise duty for fuel used around homes (including in domestic appliances such as lawnmowers and chainsaws), in motor vehicles (including road registered motor vehicles), recreational boats and aircraft.

In exploring these new entitlements, we concluded that it likely costs considerably more to administer claims than the amount of funding provided to Waka Kotahi the NZ Transport Agency. To address this, a regulatory funding review is underway. Waka Kotahi the NZ Transport Agency is exploring improvements to its systems to handle claims and potentially implementing an online system for fuel excise duty claims.

Why are recreational boaties not able to claim for fuel used on the water?

People who use fuel in a recreational boat are not entitled to claim a refund or rebate for a range of reasons. For fuel excise duty, funding is provided to activities that benefit the recreational boating community (namely, search and rescue and recreational boating safety), instead of a refund. Providing a refund would compromise this arrangement that benefits the recreational boating community. On 16 July 2020, the Minister of Transport announced a significant increase in funding for search and rescue and recreational boating safety. You can read more about the funding increase here(external link).

Why wasn’t an entitlement for petrol or diesel used in aircraft recommended?

We investigated creating an entitlement for aircraft, recognising that some aircraft use petrol or diesel. In exploring a new entitlement, we found that the cost of administering claims was likely similar to the value of many claims. At this time, it was considered administratively inefficient to administer such claims.

COVID-19 has impacted aviation, why not introduce a refund or rebate for petrol-powered planes?

The Government has announced a significant aviation relief package which includes pausing the Civil Aviation Authority’s Funding Review. This means for a range of sector participants, including for recreational aviators, that the Civil Aviation Authority’s fees, charges and levies will not change for 12 months.

Why are individuals who use fuel in a lawnmower or chainsaw at home unable to claim?

We explored creating an entitlement for fuel used in lawnmowers and chain saws. However, we found the cost of administration would exceed the value of many claims, and concluded it would be inefficient to administer such claims.