The Government's petrol price hike is being described as an outrageous tax grab.
Labour says people are being told to tighten their belts and now they're being socked with an excise increase of 2 cents a litre.
Transport Minister Gerry Brownlee announced the price rise on Tuesday, saying it was deferred from July last year because of the financial crisis and the Canterbury earthquakes.
Road user charges for freight operators are also going up by 4.1 percent, although rule changes mean they won't be uniform across the industry.
"This increase is effectively a catch-up to ensure there continues to be sufficient revenue available to meet the Government's land transport expenditure targets," Mr Brownlee said.
It's effective from August 1 and Labour's transport spokesman, Phil Twyford, says the Government is going to rake in an extra $100 million a year.
"This will hit motorists at a time when Kiwi families are struggling to make ends meet," he said.
"Businesses are working overtime to keep afloat and the last thing they need is an increase in transport costs."
Mr Twyford says the money will add to billions already being spent on highways which, on the Government's own figures, are poor value for money in economic terms.
"It should invest more in rail, coastal shipping and public transport instead of pouring $10 billion over the next 10 years into their hand-picked motorway projects."
NZN