Electric car discount bill to be passed, but PHEVs are on the clock
ALP delivers on its promise of drastically cheaper BEVs, PHEVs and FCEVsThe federal government’s proposed Electric Car Discount Bill will pass though the Upper House later this week, locking in some significant discounts on zero-emissions vehicles via fringe benefits tax exemptions.
The federal government’s proposed Electric Car Discount Bill will pass though the Upper House later this week, locking in some significant discounts on zero-emissions vehicles via fringe benefits tax exemptions.
Under the proposal, battery-electric (BEV), hydrogen fuel-cell (FCEV) and plug-in hybrid (PHEV) vehicles priced under the $84,916 luxury car tax threshold will all be exempt from the fringe benefits tax (FBT) and five per cent import tariff, saving businesses up to $9000 off a $50,000 vehicle and individuals salary sacrificing their vehicle up to $4700.
The catch is that PHEVs will only be included in the scheme until April 1, 2025, at which point support for the half-way house form of electrification will be withdrawn, leaving EVs and FCEVs as the only eligible vehicle technologies.
Extra priority will also be given to increasing the abundance of EVs in the government’s own fleet procurement policy by removing PHEVs wherever possible and replacing them with EVs – a move that will push more zero-emission vehicles into the used-car market and thereby further lower prices.
The amendments were brought about by the Greens and independent David Pocock in the Senate, who said they’d support the Bill on the proviso the above conditions were met.
Greens leader Adam Bandt said the amendments had fast-tracked electric vehicles and that the ATO would “issue guidance on when household charging technology is able to be included within fringe benefit tax-exempt vehicle packages”.
“The government fleet will go electric, and when these cars are sold second hand, it will help bring the cost down of EVs for everyday people,” he said.
“By limiting handouts to petrol cars and accelerating support for electric vehicles, the Greens in balance of power have pushed the government to go further and faster on climate.”
The deal between the government and the Upper House cross benchers has been welcomed by the Electric Vehicle Council (EVC), one of the longest and most vocal supporters of the original proposal.
EVC chief executive Behyad Jafari described the agreement as a “landmark moment for EV policy in Australia” and said it was a good indication as to “how far we've come in just a few short years”.
“This bill will allow thousands more Australians to get behind the wheel of an EV where they can access the benefits of lower fuel bills, cutting pollution, and an enjoyable driving experience,” he said.
“Making new EVs easier to buy will turbocharge the creation of a strong second-hand market for EVs, which is vital for affordability.”
Once in effect, the policy’s savings will be backdated to July 1.
Related: FBT exemption for EVs a “game-changer” for consumers
Related: Industry welcomes ALP's EV policy
Related: Labor EV discount plan starts July 1 – but is it enough?
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