South Australia’s move to bring EVs into the tax system is a step in the right direction, but one which will require a national approach to ensure consistency and fairness.
So says the Australian Automobile Association (AAA) which has long argued that Australia needs a new way of funding transport projects, as technological shifts reduce fuel excise revenue.
The South Australian government is right to start this transition by focussing on EVs, just as many other jurisdictions are around the globe, AAA managing director Michael Bradley says.
But he cautions the federal government needs to play a coordinating role to ensure drivers are treated consistently across the nation.
“The South Australian Government deserves to be congratulated on taking a position of leadership and for taking on a tax reform that has for too long sat in the too-hard basket,” Bradley says.
“Ensuring all drivers contribute to the transport projects we all need makes our tax system more sustainable and more equitable.
“However, a state-by-state approach to what in reality is a national road network and a national market, brings risks. Inconsistent approaches risk unnecessary cost, inequity, and confusion,” he adds.
“This is a critically important reform and one that the federal government needs to take an interest in to ensure changes are made consistently, equitably, and in a manner that does not disincentivise technological transition.”
The EV tax proposal has been criticised by the Federal Chamber of Automotive Industries (FCAI) and the Electric Vehicle Council.
South Australia will join US states of California, Utah, Oregon and Washington, which are already either implementing or trialling road user charging systems that incorporate EVs, the AAA says.
October’s federal Budget shows Australian motorists will pay $49.3 billion in fuel excise over the next four years, which will fund roads and other land transport infrastructure.
The AAA advocates that EVs be brought into the tax system initially at a discounted rate to avoid disincentivising their take-up, and recommends governments apportion revenue from any EV road user charge to future programs that incentivise development and roll-out of ultra-low fuel consumption technologies and infrastructure.
The AAA’s constituent clubs – NRMA, RACV, RACQ, RAA, RAC and RACT – are major investors in EV recharging networks.
