Putting a new tax on electric vehicles without related concessions, as has been proposed in Victoria, New South Wales and South Australia, would likely face strong opposition and discourage Australians from purchasing zero and low emissions cars, a leaked intergovernmental document has shown.

The analysis of potential models for state based Road User Charges for electric vehicles, prepared for the ‘Board of Treasurers’ comprising representatives from each state and territory, shows:

• A new EV tax would likely ‘discourage EV uptake’ and ‘face strong opposition from industry and environmental stakeholders’
• Live GPS tracking of all electric vehicles is being considered as a way to monitor and charge for a variable, per kilometre usage fee.
• States were told to consider the need for legal advice around potential constitutionality issues relating to the tax.
• Designing and implementing an EV tax is likely to be ‘resource intensive’ and EV owners living near borders may be unfairly disadvantaged.
• ‘Responding to opposition from green vehicle industry’ is recorded as a ‘level 2’ priority that will require nationally coordinated approach.

“This document shows there are real risks associated with the introduction of a new tax on electric vehicles,” said Richie Merzian, Director of The Australia Institute’s Climate & Energy Program.

“Privacy issues, practical difficulties, constitutional concerns and discouraging the uptake of EVs are just a few of the problems highlighted in this discussion paper.

“EVs are a cleaner, quieter and safer transport alternative. Now is not the time to put a great big new tax on this emerging industry.

“There is an argument to be made for a broad and comprehensive charge that accounts for the pollution being emitted by every vehicle on the road, but simply putting a new tax on EVs would be a backwards step for Australia.

“This seems like an orchestrated attempt to punch down on the 20,000 Australians who have adopted clean, green technology which will help to reduce Australia’s transport emissions.

“It is ironic that states with net zero emissions targets are now pulling the handbrake on reducing pollution from one of the highest emitting sections.

“It is particularly disappointing that the Victorian Government has been leading this secretive process over the last year. The question has to be asked, why were they developing this policy behind closed doors and why has there been no consultation with industry and interested stakeholders?

“Governments need to hit pause on this half-baked policy proposal and come back after undertaking proper consultation with industry representatives and the community.”