The findings of the independent review into Road User Charges (RUCs) highlight the need for a complete re-think on the treatment of clean, diesel, passenger cars, according to BMW New Zealand.

The Review's recent recommendations that RUCs for small diesel vehicles be increased, but those for heavy trucks be substantially reduced, have sparked outrage from vehicle manufacturers and road-users alike.

BMW Group New Zealand Managing Director, Mark Gilbert said the increasing tax burden placed on diesel passenger cars contradicts the government's own policy which encourages the use of fuel-efficient vehicles.

"On the one hand, the Government is seeking to encourage car-buyers to compare fuel efficiency and buy economical vehicles. But Road User Charges see these motorists penalised under a system designed for
heavy, commercial trucks," said Mr Gilbert.

BMW is calling for RUCs to be dumped in favour of a diesel tax collected at the pump with heavy transport operators paying a separate fee, linked to the weight and fuel efficiency of their vehicles.

"A tax at the pump, as is currently applied to petrol, is the most accurate and transparent means of ensuring that all road users pay their fair share," said Mr Gilbert

Road User Charges were designed to recover the costs imposed on the roading system by heavy transport users at a time when small diesel passenger cars were virtually non-existent. However, last year BMW sold more new diesel cars than petrol cars in New Zealand, and this trend is forecast to continue.

Mr Gilbert said that the Road User Charges system has become antiquated and inappropriate, given today's abundance of diesel passenger cars which are among the most fuel efficient cars available."Our BMW 118d which can drive 100 kilometres on 4.7 litres of diesel was named 2008 World Green Car of
the Year yet road user charges erode any cost-benefit to the consumer from these fuel savings," he said.

Mr Gilbert cited the example of the Government's own fleet of diesel-powered BMW 7 Series limousines as an example of the absurdity of Road User Charges.

"The Department of Internal Affairs awarded its VIP fleet contract to BMW on the grounds of extremely low whole-of-life costs and the fact that the BMW 7 Series outperforms cars half its size in terms of fuel economy. To then impose the same weight-based Road User Charges tax as that of a commercial truck is sheer lunacy," said Mr Gilbert.

A new BMW 730d Series weighs more than two tonnes and is therefore classified as a 'large diesel car' under the Road User Charges system. However, its combined fuel economy figure of 7.2 litres per 100 kilometres earns a 4½ star fuel economy rating, the same rating as a 1.4 litre Fiat 500 which weighs just 930kg, and pays no road user charges.

"The Government should be incentivising the move to cleaner, more fuel-efficient diesel vehicles not penalising these motorists to subsidise trucking companies," he said.

In criticising the current scheme, Mr Gilbert added that the 'pay in advance' system of Road User Charges adds insult to injury.

"Consumers who have chosen a fuel efficient diesel car face the impost of having to purchase RUCs in advance creating a further financial penalty," said Mr Gilbert.

"It's time the Government instead rewarded those choosing a cleaner, more economical vehicle with a user-pays pump tax as is applied to petrol cars," he said.