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The business lobby accuses Victoria of putting a cart in front of the horse with the electric vehicle tax on electric, hybrid and low-emission cars

Australia’s leading group of companies has called for a moratorium on electric vehicle taxation to warn that the added cost will discourage consumers from buying cleaner vehicles and limit government and industry efforts to meet zero emissions targets.

The Australian industrial group has effectively opposed the Victorian Labor government, which last month passed legislation to parliament introducing a tax on electric cars and other zero-emission vehicles.

Innes Willox, executive director of AIG, which represents more than 60,000 companies, said these taxes are like “putting the wagon before the horse and shouldn’t be introduced until clean vehicles are better established and taxes are better designed”.

“Road infrastructure has to be paid for, and it will be important in the long term to maintain the tax base as batteries and fuel cells replace the petrol tanks in the Australian vehicle fleet,” said Willox.

“But Australia is currently far behind our competitors in this transition. Our slow adoption of clean vehicles is holding back national progress in meeting emissions targets – and putting pressure on all other parts of the economy to cut back.

AIG’s climate and energy advisor, Tennant Reed, told The Guardian that AIG entered the position after receiving feedback from its group on energy and climate leaders and the electric vehicle working group, the transportation company, an electrical appliance supplier and property managers include.

“We have received feedback from companies wanting to make access to cleaner vehicles easier to meet their own emissions reduction commitments and from companies looking to provide the infrastructure to support electric vehicles. However, this applies not only to the way in which members achieve their own goals, but how successfully business-wide goals can be pursued, ”said Reed.

The bill currently being submitted to the Victorian government provides a road tax per kilometer for users of electric vehicles and other low-emission vehicles. From July 1, 2021, a fee of 2.5 cents / km will be charged for electric and emission-free vehicles and a fee of 2.0 cents / km for plug-in hybrid electric vehicles.

The justification for this is that EV owners are missing out on paying a fuel tax plus GST on gasoline, diesel and gasoline that other vehicle owners pay and the state wants to find a way to make up for that loss.

Electric vehicle owners would pay an average of $ 330 extra per year compared to other motorists who pay nearly $ 600 per year in fuel taxes, according to state government calculations.

Victorian Treasurer Tim Pallas, the driving force behind the legislation, said: “These reforms are about ensuring that all motorists pay their fair share to use our roads while we continue to incentivize zero or low-emission vehicles . “

“By introducing a road user charge before a significant increase in usage, we ensure that everyone pays a fair and sustainable charge for the use and wear and tear of our road network. This means safer roads. “

However, Behyad Jafari, CEO of the Electric Vehicle Council, told the Guardian that EV drivers have already paid higher taxes than other drivers as part of the upfront costs for vehicles such as GST, stamp duty and registration.

“An electric vehicle costs more on average than a gasoline and diesel vehicle … So the taxes you pay apply to those upfront costs, which means that electric vehicles already pay a lot more taxes than a gasoline vehicle.

“The Victorian government is unique in the world in that we actually want to impose a new tax on electric vehicles, while in most of the world we have places that say we actually want to exempt electric vehicles from taxes because we want to at this early stage we help people choose one instead of buying a very polluting gasoline or diesel car. “

Analysis by the Electric Vehicle Council found that every driver who switches to an electric vehicle brings a $ 8,763 boost to the Australian economy over 10 years, including a $ 1,370 benefit on government revenue. The analysis found that EV drivers not only pay additional taxes upfront, but also contribute to the economy by reducing pollution and improving respiratory health.

The South Australian government has put its plans to charge an electric vehicle on hold. Meanwhile, the ACT has categorically rejected the idea, and Tasmania and Western Australia have confirmed they have no plans for one on the horizon. New South Wales has publicly introduced an EV road user tax, with Treasurer Dominic Perrottet announcing that he will submit a plan to the Cabinet this year.

The Guardian announced last December that Australian states had been warned of a clean car road user tax that was introduced with no other support for the technology.

The report, authored by the Victorian Treasury Department, argued that a new form of levy was warranted as the rise of cleaner cars would reduce fuel revenues for gasoline and diesel, known as a “proxy levy” for road transport.

However, the report also found that a road user tax without new incentives to make electric vehicles more attractive could hinder the uptake of electric vehicles, slow down emissions reductions, and potentially shift the market towards fuel-efficient fossil-fuel cars.

A separate analysis by Dr. Jake Whitehead of the University of Queensland found that Victoria’s policies could result in electric vehicles having a 25% lower share of new sales in 2050 than otherwise expected.

Pallas said the state government was trying to incentivize the introduction of electric vehicles with reduced registration fees and concessions on stamp taxes.

The Green Recovery: How To Get More Electric Vehicles On Australia's Roads - VideoThe Green Recovery: How To Get More Electric Vehicles On Australia’s Roads – Video

In the meantime, the Greens in the Bundestag introduced a bill for private members to penalize states that tax electric vehicles and to pass that money on to other states that have no discriminatory taxes or fees for electric vehicles. The bill is currently before the Economic Committee and a public hearing is scheduled for April 22nd.

Green spokeswoman for electric vehicles, Janet Rice, said she was confident that other parties would come to the table and speak out against states that would not encourage the adoption of electric vehicles.

“Governments should phase out the internal combustion engine and not levy taxes on the cleaner competitors,” she said.

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