Victoria Announces EV Subsidy After Tax Backlash

Victoria Announces EV Subsidy After Tax Backlash
Image: NIssan

The Victorian government has introduced a rebate on electric vehicles (EVs) after copping backlash for its upcoming road user tax for low emissions cars.

What is the Victorian road user tax?

Last month it was announced that from July low-emission vehicles such as EVs and hybrids would be subjected to a road user tax.

This will see EV drivers charged 2.5 cents for every kilometre they drive. Hybrid drivers will be charged 2 cents per kilometre.

“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,” Victorian Treasurer, Tim Pallas, said at the time.

The tax has received significant backlash, including from car manufacturers such as Nissan.

However, Pallas also said that the Victorian government would pledge $45 million for policies to boost uptake of low-emission vehicles. And it looks like it is finally making good on that promise.

Victoria offers an Zero Emissions Vehicle Subsidy

The government is offering 20,000 subsidies of up to $3,000, but there are a few caveats. They have to be a new EV and cost under $68,740 The rebates will be offered in stints and the first 4,000 are now available.

The rebates will be available from car dealerships and you can read more about it here.

But despite hybrid vehicles being subject to the road user tax later this year, they are not eligible for the rebate. It’s for zero emissions vehicles only.

This subsidy is part of the Victorian government’s plan to have half of cars sold in Victoria to be low-emission by 2030.

The rebate is part of a $100 million EV uptake plan in the state.

The plan will also include $19 million to install 50 new public charging facilities to the existing 24 sites across the state.

According to The Driven they will be located in key locations such as on highways and tourist attractions.

$10 million of the fund will also be used for 400 new EVs for the government’s own fleet over the next two years.

Will this help?

At the present time roughly 0.6 per cent of new cars sold in Australia are electric. And there’s a few reasons for this.

Firstly, they’re quite pricey. The vast majority of EVs in Australia are still around the $50,000 mark.

And without a robust public charging network, EVs aren’t a particularly viable option for apartment dwellers or people who don’t own a detached house where they can install a personal charger.

And because we’re such a big country, range anxiety is still a major concern. Which is why, again, there needs to be more done to expand the public charging network and improve infrastructure to accomodate EVs.

And then there’s the distinct lack of subsidies. While Victoria’s announcement is a step in the right direction, it joins just a handful of state incentives for EV uptake across the country. And there is still not a single federal incentive for EV adoption in Australia.

So with all of this, including a tax, in mind — it’s difficult to gauge how much $3,000 will actually help EV uptake.