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Light vehicles have a maximum weight (gross vehicle mass (GVM)) of less than 3.5 tonnes. Light vehicles include passenger and commercial vehicles such as cars, vans, utes, SUVs and 4WDs.
Owners of vehicles powered by petrol, CNG or LPG contribute by PED when they buy their fuel. Owners of vehicles powered by diesel, or any other fuel, including biodiesel, electricity or hydrogen, pay RUC by purchasing a RUC licence. Vehicles powered by hydrogen are also subject to RUC.
All heavy vehicles over 3.5 tonnes are subject to RUC, regardless of the type of fuel they use. Almost all heavy vehicles use diesel as the fuel.
There are some exceptions:
On average, petrol and light diesel vehicle users pay about the same amount in PED or RUC to travel the same distance — about NZD$750 for 10,000km.
Diesel vehicles tend to travel further than petrol vehicles in a year so users may pay more in total. How much you will pay each year for tax depends on how much fuel you use and how far you plan to travel. However, the different systems — PED and RUC — mean that some road users contribute more and some less.
In general, users of efficient diesel vehicles will pay more in taxes than a similar petrol vehicle and less efficient petrol vehicles will pay more than similar sized vehicles that pay RUC. Neither tax is intended to address the climate change impacts from the use of the fuels.
Use our calculator to compare all of the different charges for light petrol and diesel vehicles.
Whether your diesel vehicle is a small 1.5-tonne car, or a large van or SUV with a maximum GVM of up to 3.5 tonnes, you pay RUC at the same rate. This is because vehicles in this weight range cause very little road damage. About 2% of RUC — that is, around NZD$1 for each 1000km — relates to the weight of your vehicle. Heavier diesel vehicles such as trucks and buses pay a much higher contribution towards road maintenance.
As well as PED and RUC there a range of other charges, such as ACC levies and carbon charge that motorists pay to use the roads. In Auckland, motorists also pay a regional fuel tax.
Some costs are applied to all vehicles regardless of their type and weight — for example, costs for drainage, signage and building new roads. For a light diesel vehicle, RUC is set at a similar amount as the average petrol vehicle owner pays in PED. We estimate that a petrol vehicle uses around 9.5L/100km, so if you have a less efficient vehicle, you pay slightly more PED than an equivalent diesel vehicle pays in RUC and if you have an efficient vehicle you may pay less.
Between 30% and 40% of diesel is used off-road — on farms, for construction, industrial and commercial ventures, and in ships. If we collected excise on diesel in the same way as PED, then we would have to set up a system to refund the RUC portion of the fuel costs for off-road uses. We would also still need to retain RUC for heavy vehicles to recover the costs of damage to our roads that these vehicles cause. These measures would be expensive and cumbersome to administer and create unnecessary costs for owners to comply with. We would also need to manage potentially fraudulent refund claims.
PED and RUC are not designed to incentivise fuel efficiency. The more petrol you buy, the more PED you pay, so having a fuel-efficient vehicle can reduce that. As RUC is based on the distance you travel, the amount you pay will be less if you do not travel long distances.
PED and RUC are just one consideration when you choose a vehicle. For example, the benefits of running a diesel vehicle increase if you take into account their fuel economy which tests show are generally between 20% and 30% better than a petrol engine.
Waka Kotahi NZ Transport Agency has a website where you can find the safety rating and the expected fuel economy of a car you plan to buy. It also offers advice about other aspects of buying a vehicle.