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EV uptake set to stall following tax changes

  • August 17 2021
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EV uptake set to stall following tax changes

By Cameron Micallef
August 17 2021

Special EV taxes introduced by state governments are creating a disincentive for Aussies to choose cleaner vehicles and slowing Australia’s overall transition to net zero, new data has revealed.

EV uptake set to stall following tax changes

EV uptake set to stall following tax changes

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  • August 17 2021
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Special EV taxes introduced by state governments are creating a disincentive for Aussies to choose cleaner vehicles and slowing Australia’s overall transition to net zero, new data has revealed.

EV uptake set to stall following tax changes

Following South Australia’s November announcement of a planned new policy, dubbed the ‘worst EV policy’ in the world, Victoria too has jumped on the bandwagon of seemingly dishing out punishments to drivers of electric vehicles.

Under Victoria’s new laws, clean-vehicle owners must keep a record of odometer readings to provide to authorities at the end of each year. Once they’ve done this, they can expect a possibly hefty bill – charged at 2.5 cents a kilometre – adding at least $3,000 to the cost of owning an EV over its lifetime.

Although the South Australian government has yet to formally commit to the new tax, it is widely predicted the state government will follow Victoria’s lead.

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Ahead of the new tax, The Australia Institute has quizzed about 600 people in South Australia to gauge public opinion on EVs. They found that almost 70 per cent will be less likely to purchase an electrical vehicle if the new user tax is enacted.

Responding to the figures, AI’s director for SA Noah Shultz-Byard said new user charges will “pull the handbrake” on consumer enthusiasm for electric cars.

“Our research shows that the vast majority want more EVs on the road, not less, because they are considered to be good for the climate, health and the environment,” he said.

According to the findings, around 43 per cent of South Australian motorists said they were considering switching to an EV, while three in four agreed that subsidies for the industry make sense.

Mr Shultz-Byard believes the move to introduce an EV tax goes against much of South Australia’s current climate policies.

“South Australia is leading the nation with its adoption of wind and solar power, but those efforts will be badly undermined if the government moves ahead with its EV tax,” he said.

“Tailpipe emissions in South Australia remain high and, in light of the IPCC’s latest report on the state of the climate, we should be doing all we can to switch to zero-emission vehicles.”

But consumers aren’t alone in opposing the plan. At the time the state first spoke of its new tax plans, Hyundai, Volkswagen, Uber and the Electric Vehicles Council inked a letter to the government describing the tax as the “worst electric vehicle policy in the world”.

South Australia had also planned to introduce a road user charge this year but has put it off until July 2022, partly to gauge the impact of the Victorian legislation.

EV uptake set to stall following tax changes
EV uptake set to stall following tax changes
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About the author

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Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

About the author

author image
Cameron Micallef

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

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