Federal Government announces national incentives for electric cars in Australia – UPDATE
By Sourced Externally
April 3, 2023
The new zero-impact policy takes a revised approach to electric vehicle taxes and incentives on a national scale.
UPDATE 1-April-2023 12.00pm – Happy April Fools Day! Ah, the rebate giveth but the tax taketh away. While we hope the powers that be are never foolish enough to deliver a zero-effect tax/rebate equation, we know this feels stupid enough to be something put to the table.
Here’s hoping common sense prevails from this point on. Happy April Fool!
The Federal Government has today announced a single, national approach to electric vehicle incentives, cash-back schemes and road user charges that will supersede the current patchwork regulations that are different in each Australian state and territory.
The ZE (Zero Effect) policy seeks to employ a more balanced approach to the fractured state-based electric vehicle programs and forms part of the Government’s forthcoming NEVS (National Electric Vehicle Strategy) rollout.
“Current incentive and usage programs are managed by different departments within the states, which can be confusing for the public,” says Assistant Minister for Infrastructure, Transport and Animal Welfare, Norom Sumarongi. “The ZE policy takes a uniform, national approach which is what Australia needs to catch up to the rest of the world.”
In Victoria, for example, electric vehicle purchase incentives are managed by the Department of Energy, and road-use tax is managed by VicRoads, which is an agent for the Department of Transport.
The ZE policy seeks to combine the two programs as well as re-valuing the incentive offering which will be calculated based upon the new vehicle’s availability and use plans.
There are caveats to the policy, in that any car purchased under the ZE incentive scheme must be sold within three years’ time to help create a thriving second-hand EV market.
While part of the rollout includes road use taxes for all states, it also includes new vehicle incentives across the market, regardless of the purchase price.
“We are really wanting this to be more simple for more buyers, regardless of their location or vehicle choice,” Sumarongi said. “The policy is about balance and fairness.”
Under the new rules, a car that would attract a $250 annual use charge (10,000km at $0.025 per kilometer) each year for three years, will be supported by a $750 incentive rebate.
x $0.025 per km
$900 – tax
Even buyers of high-priced EVs like the Porsche Taycan or Mercedes-Benz EQS will benefit from the new scheme, with a car planned to be driven approximately 20,000km each year receiving a $1500 purchase rebate against a $500 annual use charge for each of the three years of ownership.
The rebate calculation is a multiple of 36 months of driving a new-energy vehicle the same estimated distance each month, multiplied by an incentive factor of $0.025.
Months of ownership
x Distance per month
x Incentive factor
$900 – rebate
“We want to encourage people to buy an electric car and reduce our reliance on fossil fuels, but then need them to recognise that by not buying petrol they are impacting the economy and need to pay for road use some other way,” said the Assistant Minister. “The calculations that have gone into this program are highly complex as we want ZE to be the fairest for everyone.”
The 36-month tax bill is payable upfront, negating the use for logbooks or odometer submissions, where the incentive is a single credit payment passed on to the buyer once the vehicle has been delivered.
As part of the streamlined policy process, both the three-year advance road-use invoice and rebate cheque will be posted to the owner at the time of purchase.
“Net-Zero sustainability is at the core of what all Government policies are about, and so all the paperwork will utilise 50 per cent recycled materials that are made from Australian raw materials.”
The Assistant Minister confirmed that the printing and packaging processes associated with the program are conducted offshore, but then flown back to Australia for the fastest turnaround.
“We’re planting a garden with twelve new native trees to offset the fuel use too,” Sumarongi noted.
While the program is expected to cost some $23 million in operational expenditure over the first three years, it is proposed to generate close to $4m per year in road tax, while paying out close to $12,000,000 in new vehicle purchase incentives.
“The implementation of the ZE program puts Australia back at the forefront of government policymakers around the world,” said Sumarongi. “The ZE policy does exactly what it sets out to do, creating Zero Effect for motorists.”
Further detail about the policy is expected to be announced after midday today.