Biggest change to how we fund our roading network in 50 years
In August 2025, the New Zealand Government confirmed that by around 2027, all light vehicles, including petrol cars, will pay Road User Charges (RUC) through a fully digital system. This marks the end of the traditional petrol tax and the beginning of a distance-based model for funding road maintenance.
This announcement follows earlier changes in April 2024, when electric vehicles (EVs) and plug-in hybrids (PHEVs) began paying RUC for the first time. But the August 2025 decision goes much further: it will eventually bring all 3.5 million light vehicles in New Zealand into a single, modernised RUC system.
For everyday drivers, this will mean a shift away from paying at the petrol station to paying based on kilometres driven. For fleet managers, it represents a major compliance shift and an opportunity to embrace Argus’ Smart ERUCs solutions, which simplify operations, reduce costs, and eliminate paperwork.
In this blog, we’ll cover what the new law means for drivers and fleets, the considerations being discussed, and how Argus Tracking can support businesses through the transition.
What Is RUC and Why Is It Changing?
How RUC Works Today
Currently, New Zealand has a dual system for road funding:
Petrol vehicles pay a fuel excise tax (about 70 cents per litre) at the petrol station, which goes toward maintaining roads.
Diesel vehicles, EVs, PHEVs, and heavy vehicles pay RUC based on distance travelled, using either paper licences on windscreens or electronic systems (ERUCs).
Why Is the Change Happening?
The government says the current model is no longer sustainable, mainly because:
Electric vehicle adoption is growing: EVs don’t use petrol, so they bypass fuel tax completely under the old system.
Petrol vehicles are becoming more fuel-efficient, which reduces excise revenue.
Road maintenance costs are rising, and funding is no longer keeping pace with demand.
In short, the government’s plan is to create one fair system where road costs are tied to the distance you drive, whether your car runs on petrol, diesel, or electricity.
Factors Still Being Discussed
While the new system is widely seen as fairer and more modern, a few points are still being discussed:
Fewer incentives: Some say this reduces financial perks for low-emission vehicles such as EVs.
Practical details: How payments and providers will work is still being defined.
Adjustment period: Drivers new to RUC may take time to adapt.
Overall, industry groups recognise that a unified, digital-first RUC system is the right step forward. For businesses and fleets, these discussions highlight why it’s important to plan ahead and why choosing the right RUC management partner, like Argus Tracking, matters - and the earlier you can do this, the more prepared you will be.
How Does the New Law Affect Everyday Kiwi Drivers Like You?
The change impacts all drivers, not just businesses. Here are the major points:
EVs and PHEVs Already Paying RUC
Since 1 April 2024, battery electric vehicles (BEVs) and plug-in hybrids (PHEVs) have been required to pay RUC.
Rates are currently $76 per 1,000 km for BEVs and $38 per 1,000 km for PHEVs (discounted for partial petrol use).
A Digital-First System Is Coming
The current paper-based system of RUC licences and windscreen stickers is being phased out.
According to the recent announcement, by 2027, the government plans to have a fully digital RUC system in place, with electronic records instead of physical labels.
This means, no more lost paper licences, no stickers on windscreens, and fewer trips to the Post Office.
Petrol Vehicles Will Also Move to RUC
Petrol-powered light vehicles will transition away from paying fuel excise duty (FED) at the petrol station and instead pay RUC based on distance travelled.
NZTA will step back from selling licences directly. Under the new framework, NZTA will step back from being both regulator and retailer, opening the way for approved third-party providers to manage RUC.
Example for Drivers
A petrol hatchback owner who currently pays through fuel tax will, by 2027, pay RUC per kilometre instead.
An EV driver already paying RUC today will simply move onto the same streamlined digital platform as everyone else.
What Does This Mean for Fleet Managers Across New Zealand?
For fleet managers, the RUC law change is a fundamental shift in daily compliance and cost management. With a fully digital system, paper licences will vanish, NZTA will step back from direct sales, and every vehicle in your fleet (petrol, diesel, or electric) will fall under the same framework.
Planning ahead is critical. Fleets that prepare with Argus Tracking will be in the best position to take advantage of digital tools and streamlined reporting, while minimising compliance risks.
Key Implications for Fleet Managers
Unified RUC Across Mixed Fleets
By 2027, petrol, diesel, and electric vehicles will all fall under the same RUC system. This creates a single, consistent approach to compliance across your entire fleet.End of NZTA Point-of-Sale
With NZTA stepping back from selling licences directly, fleet managers will need to work with approved providers. Argus Tracking offers integrated solutions to simplify this transition today.Less Paperwork
The removal of paper licences will streamline compliance, while Argus Tracking’s Smart ERUCs go further by automating the entire RUC process to keep fleets compliant and prevent costly manual compliance errors.Cash Flow Flexibility
The move to digital RUC is expected to introduce flexible payment options, such as monthly billing and consolidated invoicing. This will give businesses better control and forecasting ability.Adopting the Right Tools Early
Automating RUC with Smart ERUCs is essential for modern fleet management. Early adoption reduces administrative workload, eliminates compliance risks, and ensures fleets are ready for the 2027 changes.
How Argus Tracking Can Support You
At Argus Tracking, we’ve always focused on making compliance and reporting simple, reliable, and stress-free. With the upcoming RUC law changes, our Smart ERUC solution is designed to keep fleets ahead of the curve.
Why Choose Smart ERUCs from Argus?
Stay Compliant Without Costly Mistakes
Manual licence management is prone to errors that can result in fines or downtime. Smart ERUCs update instantly whenever RUCs are purchased, ensuring your fleet is always displaying the correct and current licence.
Cut Out the Paperwork
No more waiting for licences to be delivered, sorting through paperwork, or manually distributing stickers to each vehicles. With Smart ERUCs, the process is fully automated, giving your team more time to focus on higher-value tasks that grow the business.Smart, Practical Hardware
Our NZTA-approved display screens are compact, energy-efficient, and easy to mount on the windscreen. For vehicle distance tracking, our GPS tracking measures distance with precision, offering a more affordable and reliable alternative to e-hubos. No external power or constant connectivity required.
Future-Proofed for the 2027 Shift
With petrol vehicles joining the RUC system by 2027, now is the time to get ahead. Argus Smart ERUCs are designed to scale across diesel, EV, PHEV, and soon petrol fleets, so you’ll be ready for whatever comes next.
Device Key Features:
Auto-update RUC purchases with NZTA.
Are wireless, SIM-enabled, and self-installing (no technical expertise needed).
Connect your vehicles within minutes, keeping them compliant from day one.
With Argus, your fleet will be compliant, efficient, and future-ready without the stress of system overhauls later.
Learn more about Smart ERUCs and download our info-sheet from below.
Summary
New Zealand’s RUC law change represents the biggest shift in road funding in 50 years. EVs and PHEVs began paying RUC in 2024, and by 2027 petrol vehicles will also transition from fuel tax to a digital, distance-based charging system.
This marks the end of fuel tax and the beginning of distance-based road charges. For fleet managers, it opens the door to new compliance standards, digital-first systems, and smarter ways to streamline operations.
At Argus Tracking, we’re ready to help fleets prepare now. Our Smart ERUCs solutions reduce costs, eliminate paperwork, and future-proof your operations so you remain compliant and efficient as the new system rolls out.
Ready to simplify RUC compliance? Get in touch with our friendly team at Argus Tracking today about preparing your fleet for the road ahead.
FAQs: RUC Law Change in New Zealand
Q: Do petrol cars pay RUC now?
A: No. Petrol vehicles still pay fuel excise at the petrol station. They’ll move to RUC around 2027.
Q: What happens to paper RUC licences?
A: They are planned to be phased out. From 2027, all records will be digital.
Q: How much will RUC cost me?
A: It depends on your vehicle type and how far you drive. Currently, battery electric vehicles (BEVs) pay $76 per 1,000 km and plug-in hybrid electric vehicles (PHEVs) pay $38 per 1,000 km. Rates for petrol vehicles will be set closer to rollout in 2027.
Q: Do fleet managers need new systems?
A: Most likely, yes. With the RUC system moving fully digital, NZTA is opening the door for private providers to deliver electronic RUC solutions. Once paper licences are phased out, fleet managers will need to adopt a Smart ERUCs or a similar service to remain compliant.
