“Road infrastructure needs to be paid for and it will be important in the long term to maintain the tax base as batteries and fuel cells replace petrol tanks in Australia’s vehicle fleet,” Willox said. Innes Willox, chief executive of AIG, representing more than 60,000 businesses, said these taxes were like “putting the cart before the horse and should not be implemented until clean vehicles are better established and the taxes are better designed”.
“But Australia is currently well behind our peers in that transition. Our slow uptake of clean vehicles is holding back national progress towards emissions targets – and increasing the pressure on every other part of the economy to deliver cuts. The justification for this is because EV owners miss out on paying a fuel tax plus GST on petrol, diesel and gas that other vehicle owners pay, and the state wants to find some way to recoup that loss.
The bill currently before the Victorian government would introduce a per-kilometre road tax for electric vehicle and other emissions vehicle users. If passed, starting in 1 July 2021, a 2.5 cent/km charge will apply to electric and zero emission vehicles, and a 2.0 cent/km charge to plug-in hybrid-electric vehicles. Electric vehicle owners would, on average, end up paying an extra $330 a year, compared with other motorists, who pay almost $600 a year in fuel taxes, according to the state government’s calculations.
“We’ve had feedback from businesses who want it to be easier to access cleaner vehicles to meet their own emissions reduction commitments and businesses who are hoping to supply the infrastructure to support EVs … but this goes not just to how members meet their own targets, but how successfully economy-wide targets are going to be able to be pursued,” Reed said. The AIG climate and energy advisor, Tennant Reed, told the Guardian that AIG came to the position after receiving feedback from its energy and climate leaders group and electric vehicles working group, which includes transport businesses, electrical equipment suppliers and property managers.
“Introducing a road usage charge now, before take-up increase substantially, ensures that everybody pays a fair and sustainable charge for the use and the wear and tear on our road network and that means safer roads.” The Victorian treasurer, Tim Pallas, the driving force behind the legislation, said “these reforms are about ensuring all motorists pay their fair share to use our roads while we continue to incentivise the use of zero or low-emissions vehicles”.
“The Victorian government is unique right around the world in saying that we actually want to add a new tax on to electric vehicles, whereas what we have in most of the world is places saying we actually want to exempt electric vehicles from taxes, because at this early stage, we want to help people choose to buy one, as opposed to buying a very heavily polluting petrol or diesel car.” “An electric vehicle costs, on average, more than a petrol and diesel one … And so the taxes that you pay apply to that upfront cost, which means that electric vehicles are already relatively paying much more in tax than a petrol vehicle. But Behyad Jafari, CEO of the Electric Vehicle Council, told the Guardian that EV motorists already paid higher taxes than other drivers as part of the upfront vehicle costs, such as GST, stamp duty and registration.
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- The business lobby accuses Victoria of “putting the car before the horse” with the tax on electric vehicles | Electric, hybrid and low-emission cars.
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