According to TACC, the attack on service stations by RACT over petrol prices shows little understanding of the real issues behind petrol pump prices and fails to recognise service station operators as the 'meat in the sandwich'.

"RACT has made some totally unwarranted and poorly considered assertions in attacking service stations. Service stations operate on very meagre margins, whatever the market, and are as much victims of oil company practices, and profit-taking, as consumers," TACC General Manager, Malcolm Little said.

"The real target for RACT is oil company price manipulation and Government taxes and charges. Excise, and the application of the GST to a heavily taxed product amounts to a tax on a tax and can account for nearly 50% of the pump price. "Furthermore, oil companies have become beneficiaries of the current volatile market.

When the barrel price of oil goes up, the oil companies respond almost immediately with higher wholesale prices. But they are much slower to reduce their prices when the barrel price falls. "Retail petrol prices are influenced by market forces of demand, supply and competition. Consumers should be alert to the RACT rhetoric. Service stations are not enormously profitable businesses, in fact most operate on an average gross margin of 5% which is very low compared to other retail businesses. "The lion's share of profits on the sale of fuel go to the oil companies and the Government," Mr Little said. "Certainly, RACT, as a representative of consumer views, has a right to comment on the issue.

But it should be certain of the facts before it starts beating the drums and certain that it's shooting at the right target. "Consumers have been misled by Mr Goodman's inaccurate comments.

Petrol retailers are quite rightly very dismayed. "The RACT knows petrol retailing isn't that profitable, otherwise they would have added it to their services years ago. "Mr Goodman's comments are neither helpful, nor accurate, nor of assistance to RACT members. His comments may have more to do with RACT justifying itself to members than a genuine contribution to the issue," Mr Little said.

For more information, contact Malcolm Little at TACC on 03 6278 1611 or 0408 398 670