8 April 2026, 2:30 pm – New Zealand’s response to the fossil fuel crisis must provide immediate relief to communities and local businesses, and enable a recovery that is equitable and sustainable, building our resilience for future shocks. Some practical measures to rebalance our tax system would make a significant contribution to such a response, says Tax Justice Aotearoa (TJA), and the Better Taxes for a Better Future Campaign (Better Taxes).
“Despite the potential of a ceasefire, there are tough times ahead for many of us already struggling with the cost of living. We need an effective immediate response that provides meaningful support to those worst affected, including small businesses, those on low incomes, Māori, Pacific and rural communities,” says TJA and Better Taxes spokesperson Glenn Barclay.
“But this crisis also provides us with an opportunity to make a meaningful shift towards a low carbon economy, and energy sovereignty. It is also an opportunity to rebuild a more resilient and productive economy that rewards hard work and shares our wealth more fairly.”
“The Government seems to want to respond within its self-imposed fiscal limits, but it is likely to have to do more. There is an urgent need to grow government revenue to fund both the immediate response and the longer-term recovery,” says Glenn Barclay. “This must be done in a way that protects the least well off, while ensuring that those who can afford it, and those who benefit from it, contribute the most.”
TJA and Better Taxes are calling for the Government to immediately adopt the following measures:
- Introduce a windfall tax, targeting industries, companies or sectors that make unusually high profits during the crisis. This should apply to fuel companies, but also other sectors that may make windfall profits, such as the banks, supermarkets and energy companies. Revenue gathered via this mechanism should be earmarked for the immediate costs of the crisis response.
- Require fuel companies to report profit margins to ensure the Government has sufficient information from fuel companies and other relevant sectors to monitor windfall profits. Information on the margins of each fuel company should be published on a regular basis (e.g. weekly) throughout the crisis.
- A one off wealth tax. The crisis will hit those on low incomes much harder than the ultra wealthy. The Government should consider the one off application of a wealth tax on those who earn, or own assets, above a high threshold.
- Target investment boost to green energy. The Government’s investment boost should be amended immediately to target private investment in green energy infrastructure that will reduce our dependence on fossil fuels and make our economy more resilient (e.g. solar panels, company EVs).
- Establish recovery corporate surcharges on sectors that are vulnerable to shocks, manage critical infrastructure and services, and/or lack competition (e.g. major banks, supermarket chains, electricity gentailers) to discourage excessive profits and generate revenue to build our resilience for future crises.
TJA and Better Taxes do not support any temporary reduction of the fuel excise. It would do nothing to reduce demand for fuel and the financial advantage would flow to big corporations, and the ultra-wealthy, as much as the least well off. The measures outlined above focus on delivering relief to those least able to weather the crisis, while supporting a transition to a more equitable, resilient and productive economy.
“A windfall tax on fossil fuel companies and transparency around their profit margins will discourage price gouging, and generate the revenue we need to provide immediate support to struggling whānau and local small and medium businesses,” says Glenn Barclay. “Other tax reform measures proposed will both generate much needed revenue, and enable us to take advantage of this moment to start to rebalance our tax system to support a more sustainable, fairer future for everyone in Aotearoa.”
Tax reform is the primary focus of TJA and Better Taxes, but increased borrowing is also a legitimate way to fund crisis response, particularly when accompanied by the recommended tax measures. Further, borrowing for immediate and medium term investment to build green energy sovereignty and resilience to future shocks is appropriate; a failure to make sufficient investments would be reckless.
