Fuel tax, parental leave and childcare costs: What you need to know as Government's changes kick in

The AA is warning Auckland fuel companies it'll be keeping a close eye on their prices on Monday as the Government ditches its regional fuel tax.

It's one of a raft of changes that come into effect on Monday - including changes to the bright-line test for property investors, lifting paid parental leave and reducing childcare costs for some families.

Grinning at the gas station - something the Prime Minister expects more Aucklanders to soon be doing.

"From tomorrow the Auckland regional fuel tax will be abolished, saving motorists 11.5 cents a litre every time they fill up," Prime Minister Christopher Luxon said.

The super city's fuel tax has been in place since 2018. It was meant to last 10 years to help cover infrastructure costs - but this Government is scrapping it.

"It is a good thing as far as my pocket goes," one person told Newshub.

"It's going to have a massive effect so good one, very happy about it," a second said.

"Just because 11 cents is going to come down, is every petrol station going to play ball with that?" another asked.

That's a concern the Automobile Association also has. It's putting fuel companies on notice to ensure they drop prices by 11.5 cents.

"The AA and our Auckland members will be watching the fuel prices at the pump - so we're keen to make sure the fuel companies flow the reduction in tax through to the pump prices immediately," said Automobile Association spokesperson Simon Douglas.

It's not the Government's only change. From Monday the brightline test is being reduced meaning investors will only pay tax on property profits if they sell within two years.

Prescription fees are being reintroduced - meaning most people will have to pay $5 per prescription.

And some families will be eligible for a 25 percent refund on childcare costs, and paid parental leave will increase by about $40 a week to a maximum of $754.

"It's better than nothing but to be honest it's already low as it is," a member of the public told Newshub.

"Especially when you come from a good paying job and go onto that, it's a big drop."

The Government says it's aimed at easing cost of living pressures.

"Inflation is still double what we want it to be, it's still causing a lot of pain," said Infometrics CEO and principal economist Brad Olsen.

"So any additional support the Government can provide that isn't in itself inflationary in some other part of the economy has got to be welcomed.

"But we've got to be clear, the changes from July 1st are not going to magically mean everyone is in a great place and the economy is fixed."

Another change on the cards that isn't so welcome is congestion charging - the Government intends to support it in various cities, but is still in the process of forming a policy and a timeline.

"So we're doing it this term. We're working through policy decisions at the moment," said Transport Minister Simeon Brown.

Which might mean any fuel tax relief is short-lived.