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Electric vehicle budget impost, it’s a myth!


The Electric Vehicle Council has a new report that shows worries about electric vehicles and fuel excise tax avoidance are a furphy that masks hidden benefits to the Australian economy from switching to electric vehicles — if only Australian governments supported the move by lowering other taxes on electric.

Read on, the report shows:

… every driver who switches delivers a $1,370 boost to government coffers, and a $8,763 boost to the Australian economy.

The commonly held view that electric vehicles create a net hit to government coffers by avoiding fuel excise has been discredited by new analysis.

The new report, ‘Uncovering the hidden costs and benefits from electric vehicles’ shows every electric vehicle that replaces a combustion engine car delivers an $8,763 net benefit to the economy over a ten-year life span, including the $1,370 benefit to government revenue.

The analysis shows the average Australian electric vehicle driver already pays more tax (spread across federal and state charges) than a combustion engine driver, despite obviously saving on fuel excise. In addition the electric vehicle driver makes a significant contribution to the economy through lowering pollution and boosting the population’s respiratory health.

Electric Vehicle Council chief executive Behyad Jafari said the analysis should put to bed the idea that electric vehicle owners leave a hole in government coffers and should be taxed more to compensate.

“You often hear this idea that when someone replaces their petrol engine vehicle with an electric car they reduce their tax, because they don’t pay the fuel excise anymore. This analysis blows that argument out of the water,” Mr Jafari said.

“These numbers prove that every driver who switches delivers a $1,370 boost to government coffers, and a $8,763 boost to the Australian economy.

“Instead of toying with the idea of punishing people for buying electric vehicles by charging them additional taxes, the rational thing for government to do would be pull out all stops to encourage transport electrification.

“If a quarter of Australia’s fleet was converted to electric it would generate an economic benefit of $4.4 billion a year.”

Download the report here.

IMAGE: Andrew Roberts, Unsplash

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