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Free Rego in NSW if you spend $25 per week on tolls

Free Rego For NSWThe NSW Government has announced a new scheme for free car registration for eligible toll road users

Key Facts & Initial Thoughts

* NSW drivers need to spend at least $1,300 per year on tolls = $25 per week

* People need to remember they take holidays, get sick, and may travel overseas for work. E.g. $1,300pa / 48weeks = $27.08 p/w. However, if you travel in Sydney, $27 in tolls is easy to spend in 2 or 3 days.

* Free rego from July 1, 2018. Govt. will backdate calculations from July 1, 2017 to work out eligibility for free rego.

* Applies to private use standard cars, utes, four-wheel drives and motorcycles. Appears trucks and business vehicles not part of scheme.

* Free rego worth $127 for motorcycles up to $715 for Cars 2505kg – 2794kg, such as Toyota Land Cruiser, Nissan Patrol.

* The scheme is estimated to cost the NSW Government $100 million in the first year.

* Price recall: One important factor affecting Price Recall is that when physical cash is not used for a particular transaction, consumers are less likely to recall the price they paid for that transaction.  Not sure if the government considered this, but a backlash of this scheme is that many consumers will now go through their accounts and see what the actual toll they paid was. They may be in for a shock which will be alleviated somewhat by the free rego.

More questions to think about

* How will it work with multiple vehicles, or selling & buying a new car – assume will use the tag account but then which car would get the free rego?

* Why is the government promoting toll usage & not public transport? Are the trains and buses full?

* Does government pricing intervention ever work?   Look at what happened to the cost of childcare, housing including first home owner benefits, healthcare, electricity, etc.

* Should I buy shares in toll companies?

The scheme itself will attract plenty of attention initially. The included will be excited and the excluded will be annoyed.

People are struggling with mandatory-like service charges (MLSC’s), such as energy and transport costs including tolls, which are required to survive normal daily life. They can turn off the air-conditioning, or drive through the backstreets to avoid the tolls, but in a modern society, why should they?

MLSC’s take up a large portion of people’s cash flow and a helping hand from the government can’t hurt if tolls and other MLSC’s do not raise their prices.  If they do, is the Free Rego really Free?

For more information, visit the NSW Government website

 

One Response so far.

  1. […] top of this, the pressures on society are increasing due to the growing prices of mandatory-like service charges (MLSC’s) and other living expenses, combined with wages basically remaining stagnate. If someone could save […]