The Queensland Government 8 cent per litre subsidy for petrol was put in place following the High Court decision in Ha and Lim v NSW and Walter Hammond & Associates v NSW in 1997.
When the High Court in that case declared State business franchise fees unconstitutional, the States requested the Commonwealth to intervene to collect the revenue lost through excise and wholesale sales tax. The Commonwealth agreed to collect the money for and on behalf of the States and pay it to the States on condition that part of the money was used to put in place subsidy arrangements so no prices rose.
Attached is a letter from then Deputy Premier and Treasurer of Queensland, Joan Sheldon, dated 5 August 1997 requesting the Commonwealths intervention and pledging to return revenues passed across by the Commonwealth to taxpayers "with a view to avoiding as far as possible price increases".
Then Opposition Leader Beattie was vigorous in demanding the 8 cents a litre subsidy be enforced. See Courier Mail 2 October 1997.
The Queensland Labor Governments announcement to end this subsidy will put up petrol prices 8 cents per litre. It is in breach of the 5 August 1997 undertaking. Mr Beattie figured in October 1997 dollars it would cost Queensland families $400 a year.