There is no evidence mandatory fuel price reporting translates into price drops at the bowser, a national petrol peak body claims.
The state government on Tuesday announced it would follow New South Wales, Queensland and the Northern Territory and introduce a mandatory fuel price reporting scheme.
Premier Peter Gutwein said a fall in petrol prices around the country following a significant decrease in global oil prices linked to coronavirus had failed to reach Tasmania in the same way.
Attorney-General Elise Archer said Tasmanian motorists had paid millions of dollars more than their mainland counterparts because of the price difference.
She said all state fuel retailers would be required under the scheme to provide updates to the government on petrol prices as they occurred which would then be published on a website and through a mobile app.
Ms Archer said the government expected the scheme to be running by July.
Mr Gutwein said the government would make further interventions and would consider caps on petrol prices if petrol prices continued to be out of step.
RACT chief executive Mark Mugnaioni said the scheme would empower motorists to find out where the cheapest petrol was before they left their driveways.
He said when the Queensland Government trialed the mandatory scheme, the state's motorists saved $122.8 million in 12 months.
"Our modelling shows that since March this year, Tasmanians have paid $13.5 million more than we think they should have for fuel," Mr Mugnaioni said.
Australasian Convenience and Petroleum Marketers Association chief executive Mark McKenzie said a study by Griffith University on mandatory fuel price reporting schemes in New South Wales and the Northern Territory found they had barely made an impact on fuel prices.
He said a 2017 OECD study on compulsory fuel price reporting found retailers in some cases could increase fuel prices as they had access to prices posted by their competitors.
"Industry has an easier opportunity to match fuel prices so instead of making big moves to drop below their competitors, they can actually see their competitors' pricing," Mr McKenzie.
"This means fuel prices don't drop as hard and average fuel prices can increase under these schemes.
"Any suggestion that this is going to lower fuel prices is just not supported by the evidence."
Labor's consumer affairs spokeswoman Jen Butler said the government's belated action was welcome.
"Labor began calling for greater transparency from petrol retailers four years ago," she said.
"Tasmanian motorists have been paying too much for their petrol for far too long."