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NSW Premier Dominic Perrottet has ruled out a London-style congestion tax for drivers in Sydney's city centre.
He was responding to a confidential leaked draft transport strategy from February, advising that transport pricing needs to reflect the true cost of using the state's roads.
"Charging for road use at certain locations or times can encourage customers who have flexibility to choose other options," the document, reported by Nine, says.
Mr Perrottet dismissed suggestions of such a tax.
"There is no plan for a congestion tax and and we can rule it out completely," he told reporters on Wednesday.
A congestion tax was introduced in London in 2003, with drivers paying about $25 over a 20-square-kilometre radius of the city.
Mr Perrottet said the government encouraged its public servants to come up with new ideas and think broadly and ambitiously.
However, just because the public service advised something did not mean it would be implemented.
"We make the decisions as elected officials, the public service provides advice," Mr Perrottet said.
Congestion taxes had been considered before and ruled out.
Another suggestion was to change public transport fares, which are subsidised, to reflect "the true cost of trips".
The government receives advice yearly from the Independent Pricing and Regulatory Tribunal on public transport fares.
"We weigh that up and we make the decision, but I'm a big believer in subsidised public transport ... it's a great social good," the premier said.
Labor has seized on the report as it prepares to fight next year's election on living costs and the impact of transport on household budgets.
While the premier has ruled out a congestion tax, Opposition Leader Chris Minns is not convinced.
"I don't believe that for a second," he said.
"When it comes to this government's track record on privatisation, user pays and toll roads you should never believe it when they suggest a congestion charge is not on the way," he said.
Mr Minns said slugging western Sydney drivers has been the government's modus operandi for at least four years.
Mr Perrottet accused Labor of running scare campaigns on everything the government announces, as well as things it does not.
The leaked report comes amid an ongoing inquiry into road tolls in NSW.
The premier said he wants a fairer system.
"I don't like the fact that every time you move on to a different motorway you're paying a flagfall, that's expensive and that needs to change," he said.
Any change to toll pricing is unlikely to come before the NSW election in March as negotiations would need to take place with toll operator Transurban.
Mr Minns said that's the government's fault for its "spectacular" public policy failure of giving up road ownership and subsequent leverage in negotiations to Transurban.
"Virtually no protections were put in place for NSW motorists, many were unsure or unaware of how much they had to pay to use toll roads," he said.
Sydney households spend the most in the country on transport, with an average weekly household spend of $474.44, the Australian Automobile Association reported last week.