Back in March the Victorian government proposed a new electric vehicle (EV) tax. There’s been some backlash over this decision and now Nissan has also weighed in.
What is the new Victorian EV tax?
The proposed tax is for the upkeep of Australian roads. At the present time petrol and diesel vehicles are charged similar taxes through their usage of petrol pumps.
The tax is looking to charge EV drivers 2.5 cents for every kilometre they drove. Hybrid drivers would be charged 2 cents.
“When you consider that people who drive internal combustion engines, either petrol or diesel, those people are paying every day fuel excise,” Victorian Treasurer Tim Pallas said back in March.
“If you’re not filling your vehicle up with petrol, then ultimately you’re not paying your share of maintenance costs of dealing with our road system, so this is essentially the government making it a fairer system that so that everybody pays their fair share of that wear and tear.”
This seems fair to me…
If you think that anyone using the roads should be taxed for their upkeep, you’re certainly not the only one. And it seems fair on paper.
And it would be if there were other incentives in place to encourage the uptake of low emission vehicles.
But at the present time in Australia, they are few and far between. There are are only a handful of state based incentives and zero federal incentives.
And this is a problem.
Electric vehicles still aren’t particularly cheap in Australia. While that is changing, it’s happening far too slowly.
Combining the fiscal barrier to entry as well as a public charging network that is still in its infancy, another tax will only hinder the progress that has been made.
“It’s something of a sub-optimal situation at the moment,” said Ben Warren, Nissan’s national manager for electrification and mobility, to Gizmodo Australia.
“Charging Infrastructure is slowly happening. Ultimately though there needs to be more action on establishing the market and setting the agenda on a national stage.”
Warren also pointed out that there is some government support for EVs, such as the Australian Renewable Energy Agency (ARENA).
Back in 2019 ARENA pledged $15 million in funding for an ultra-fast charging network for EVs. It is also spearheading the Future Fuels Fund, that is providing $16.5 million for public fast charging infrastructure in capital cities and regional centres.
Still, considering that only 0.2 per cent of the Australian population currently has an electric vehicle, why are they going to be taxed further?
Nissan has also criticised the Victorian EV tax
Nissan has been a big advocate for EVs and renewables for a number of years now.
In addition to selling its own EV, the Nissan Leaf, the company has been involved in supporting battery technology as well as public infrastructure to support wider EV adoption across Australia.
So it’s unsurprising that Nissan isn’t the biggest fan of the Victorian governments proposed road user tax aimed specifically at EVs
“When we think about road user charging in isolation first and foremost, there’s argument that says road user charging on all transport is a more fair an equitable way of taxing transport and recovering the funds to pay for roads,” Warren said to Gizmodo Australia.
“At the end of the day we do need to pay for roads somehow. That in isolation is okay.”
However, Warren was also of the opinion that a tax on renewable transport options in its early stages could be detrimental to uptake.
“But when we specifically target it towards an emerging technology that has a host of other benefits — that is problematic.”
“It does have a negative impact on someone [purchasing an EV].”
Warren also brought the conversation back to EV pricing, saying that a tax would impact on “the only positive source of the return on investment which is the running costs. It adds pressure to that. It puts barriers in place at the emergence of this technology that shouldn’t be there.”
Warren went onto mention the lack of incentives for EV uptake on a federal level in Australia.
“One could make the argument that a road user charge that is offset with incentives and programs to drive uptake, that there’s a more balanced argument there,” Warren said to Gizmodo Australia.
“But in isolation a road user charge on electric vehicles thats are supposed to be helping the precipice, that’s not great.”
Nissan isn’t the only one
Nissan is by no means the only company to criticise the tax, which is set to come into effect in July.
Last week 25 organisations penned an open letter to the Victorian government, which was published as a full page advertisement in The Age.
The group was compromised of companies from a number of industries as well as environmental groups. This included the likes of Uber, Hyundai, VW and Jet Charge.
“Every other state and territory in Australia has ruled out or delayed plans for a premature new tax on electric vehicles. Going it alone will mean Victoria has the worst electric vehicle policy in the world,” the letter says.