Balancing act should be led by Feds for EVs

The Sydney Morning Herald reported the RACQ’s parent body, the Australian Automobile Association, has called for an urgent, nationally consistent tax to help replace falling revenue from fuel excise while encouraging electric vehicle uptake.

Club Head of Public Policy Rebecca Michael said the Federal Government needed to lead equitable and comprehensive road user charging reform. 

“The rise in electric and hybrid vehicles will eventually lead to reduced revenue raised by the fuel excise tax, but while we need a way to ensure fiscal equity amongst road users, we don’t want scare drivers away from investing in low emission vehicle technology which would stymie an immature EV new car market,” Dr Michael said. 

“With Victoria, South Australia and New South Wales flagging their own potential taxes on EVs we risk a system where taxes vary from state to state - which is confusing, unfair and impractical.

“Strong policy leadership is lacking and we need the Federal Government to step up to the role and introduce fair and equitable road user charging reform.”

Dr Michael said incentives were also needed to help bolster drivers’ investment in EVs. 

“Owning a new EV is still too expensive for many and until we see an affordable second-hand EV market, Australia will continue to lag behind countries,” she said.

“A sensible approach to incentives and macro-economic road user reform for all road users, that takes into account state-based motoring taxes and broader fuel and emissions policy is needed to manage the transition to low emissions vehicles.”