No increases to ACC levies
The government is keeping levies payable to ACC unchanged until 2022 in the wake of the economic impact caused by the Covid-19 pandemic.
Iain Lees-Galloway, Minister for ACC, says the work and earners’ levy will not change until at least March 2022 and the motor-vehicle levy will remain at its current level until the end of June that year.
That means people who own petrol-powered vehicles will continue to pay $46.04 a year as part of their registration fee plus six cents per litre when filling up, while owners of non-petrol passenger cars will pay $104.65. The levy workers and businesses pay depends on their industry.
“The economic outlook is uncertain, so holding levy rates is a prudent decision,” Lees-Galloway says. “It provides some certainty to businesses and other levy payers and gives ACC more time to reliably assess the impact of Covid-19 on its finances.
“The previous government increased levies during the global financial crisis only to find they were too high in following years. We are taking a cautious approach and ensuring we do not add to pressure on businesses and New Zealanders where it’s not necessary.”
ACC had already announced it was delaying invoicing businesses over their levies. These are normally issued in early July, but these had been delayed until October.
The decision on ACC levies came after Prime Minister Jacinda Ardern confirmed the multi-billion-dollar wage subsidy scheme will end, as planned, three weeks before the September 19 general election and will not be extended, while any economic respite in the form of a trans-tasman travel bubble appears some way off.
Lees-Galloway adds the government is also changing the funding targets for the levied accounts to better reflect the true costs of accidents and minimise the long-term impact on levy payers.
“ACC’s previous funding target of 105 per cent solvency for levied accounts was more suited to a private insurance company. We are lowering this target to 100 per cent solvency, which is appropriate given ACC’s unique position as a mandatory sole provider and government-supported social insurance scheme.”
