A key plank of Labor’s plan to ­accelerate electric vehicle sales is redundant, according to Energy Minister Angus Taylor, with more than 70 per cent of car imports being exempt from tariffs under free trade deals.

Mr Taylor said Labor’s plan to waive a 5 per cent import tariff on electric cars would have “close to zero impact on prices or uptake” given the vast majority of cars are already spared from the impost. “Australia’s extensive free trade agreements, entered into by the Coalition, mean that over 70 per cent of our car (electric and petrol) imports are already exempt from import tariffs,” Mr Taylor said.

Moreover, now that a free trade deal has been struck with Britain, Labor’s policy will have no impact on the cost of the five top selling electric cars in Australia.

The German-made Porsche Taycan is the only top selling electric car that is not be covered by a free-trade deal. But the Porsche’s price of $156,000 to $345,000 precludes it from being captured under Labor’s policy as it is classified as a luxury car.

When announcing its policy last year, Labor said the $50,000 Nissan Leaf would be $2000 cheaper without attracting a tariff. This is no longer the case given the tariff was waved under the free-trade deal with Britain which was signed in December.

The analysis from the Department of Industry, Science, Energy and Resources comes after energy experts cast doubt on whether the ALP has the policy levers to lift electric vehicles to 89 per cent of new car sales by 2030, up from the Coalition’s forecast of 29 per cent.

Electric vehicles accounted for fewer than 1 per cent of new car sales in 2020.

Opposition climate change spokesman Chris Bowen accused Mr Taylor of “wasting his department’s resources on confirming something that Labor was clear about when we announced our policy”.

“Yes, some EVs are already tariff-free. But not all. And electric cars are not currently exempt from fringe benefits tax. All EVs below the luxury car tax threshold would be tariff and FBT free under Labor,” Mr Bowen said.

“Angus Taylor likes to talk about technology not taxes. He should cut the taxes on electric ­vehicles,” he added.

Grattan Institute director Tony Wood last month urged Labor to outline how the 89 per cent assumption of new car sales could be justified.

“I would like to see the basis on which they can see it is believable,” Mr Wood told The Australian.

“It seems like a very bold assumption. We would have assumed to get anything like an uptake like that you are going to either need an emissions standard that enforces it or a pretty generous subsidy.

“I would want to know on what basis do they justify the connection between the assumption and the result.”

While Bill Shorten pledged to introduce vehicle emissions standards ahead of the 2019 election to help electric cars be more cost-competitive, Anthony Albanese has not adopted the policy.

Instead, Labor has vowed to wave the import tariffs and luxury car taxes for electric vehicles, while also exempting them from FBT when bought by businesses.

Labor is also planning to implement a 75 per cent electric car target by 2025 for commonwealth government vehicles.

Extracted in full from: ALP’s electric car plan spins its wheels (theaustralian.com.au)