Butane tax decision could affect other oil companies

Ramifications for other oil companies are expected following a decision that means Gull will have to pay more tax on the butane that's added to its petrol.

The Court of Appeal has ruled blending butane with petrol, amounts to manufacture under the Customs and Excise Act 1996 and is subject to the same duty as other fuels.

Gull general manager Dave Bodger says most oil companies blend some form of product at their truck-loading gantry.

"Through our good understanding that there is excise not paid on that as well, and that's been in place for some time.

"I suspect customers will be reviewing that with the other oil companies."

Dave Bodger says butane naturally occurs in petrol and adding more doesn't decrease the mileage per litre.

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