Now lawMoney & Tax Introduced in the House of Representatives, 22 Jun 2026

Smaller fuel tax cut ran for a month from July

The first fuel tax cut was due to end on 30 June 2026. This law kept a smaller cut of about 16 cents a litre. It lasted until the tax rose with prices in early August.

Official name: Treasury Laws Amendment (Fuel Excise Relief No. 2) Bill 2026

Who it affects

• Drivers: The tax in each litre of petrol and diesel stayed about 16 cents lower than normal for about a month.
• Fuel makers and importers: They paid the lower rate on fuel made or brought in during July and early August 2026.
• Truck owners: The government paired this law with a 16 cent a litre cut to the road charge for heavy trucks.

Fuel prices jump in 2026

In early 2026, conflict in the Middle East pushed up fuel prices. Fuel made in Australia has a tax on each litre, called excise. Fuel from overseas pays a matching tax at the same rate.

On 31 March 2026, the tax on petrol and diesel was 52.6 cents a litre. An earlier law cut it in half from 1 April. That law was the Fuel Excise Relief Act 2026. On 2 April, the Treasurer, the minister in charge of money, used a power in that law to make the cut bigger. It became 60.9 per cent.

That cut was due to end on 30 June 2026. On 21 June 2026, the Prime Minister and the Treasurer said a smaller cut would carry on. This law makes that happen.

A smaller fuel tax cut

From 1 July 2026, the tax on fuel is cut by 30.4 per cent. So fuel is taxed at 69.6 per cent of the full rate. The cut comes off the rate on 31 March 2026.

For petrol and diesel, the tax becomes 36.6 cents a litre. That is about 16 cents a litre less than the full rate. Most other fuels made from oil get the same 30.4 per cent cut.

The cut covers fuel made in Australia during that time. It also covers fuel made earlier if no tax had been paid by 1 July. For fuel from overseas, it covers fuel whose tax had not been worked out by 1 July.

Say a delivery driver buys 400 litres of diesel in July 2026. The tax on that fuel is about $64 lower than at the full rate.

How long it lasted

Fuel tax normally goes up twice a year, in February and August. That keeps it in line with prices. It uses the Consumer Price Index, a measure of how fast prices are rising.

The August rise usually happens on 1 August. If the price figures come out late, the rise happens five days after they are published. The Australian Bureau of Statistics, the national statistics agency, planned to publish them on 29 July 2026. That would make the rise day 3 August 2026.

The cut runs from 1 July until the day before that rise. On the rise day, the tax goes back to the full rate plus the August rise. It ends up where it would have been with no cut at all.

The law also makes sure fuel already covered by the earlier, bigger cut keeps that deal.

Start date

The bill went into the House of Representatives, Parliament's main house, on 22 June 2026. The House passed it on 23 June. The Senate, Parliament's second house, passed it on 29 June 2026.

The Governor-General, who stands in for the King, signed it into law on 30 June 2026. It became Act No. 59 of 2026, its official law number. The tax cut took effect from 1 July 2026.

The first law gave the Treasurer a power to set a deeper cut. That power was removed. It is not needed for this smaller cut.

How they voted

Its journey through Parliament

Official sources

• Bill page on aph.gov.au
• Text of the bill
• Explanatory memorandum

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