Victorians will soon pay more for electric cars after the state government revealed plans to scrap its $3000 (US$1,999) subsidy for zero-emission vehicles almost one year earlier than planned.
The cost-cutting measure revealed on a government website will put the state behind Queensland, New South Wales (NSW), South Australia and Western Australia in electric vehicle incentives.
It also comes as the Victorian government waits to hear the outcome of a High Court challenge to its tax on electric vehicles—the first of its kind in Australia.
Industry experts said the cost-cutting measure would put an unfair financial burden on Victorians, which could impact the state’s efforts to cut transport pollution.
The Victorian government cut financial support for its Zero-Emission Vehicle Subsidy in its May budget, revealing the $3000 rebate on new electric vehicles under $68,740 would end on June 30.
The scheme, launched in 2021, had been designed to subsidise 20,000 electric vehicles and was not due to end until May 2024.
A Victorian government spokeswoman told AAP the subsidy had already helped the state move closer to its emissions reduction goal.
“We’ve laid the groundwork to achieve our target of 50 percent of all light vehicle sales being (zero-emission vehicles) by 2030,” she said.
The government has also committed to spending $19 million on more electric vehicle charging stations in regional areas, she said.
But Victorian Greens transport spokesperson Katherine Copsey said cutting the vehicle subsidy was a backward step that would compound the effect of the state’s electric vehicle user tax.
“Victorian Labor’s electric vehicle policy was already the world’s worst, and somehow it just got worse,” Copsey said.
“It’s disappointing that this government continues to punish Victorians who want to reduce their emissions and boost climate-friendly transport.”
Electric Vehicle Council chief executive Behyad Jafari said Victorian electric car owners were already paying an average of $1,600 a year as part of the state’s road user tax, and the new cuts would be a further disincentive to replace a petrol or diesel vehicle.
“If you’re a Victorian who is looking to decarbonise transport, you must be looking at every other state and territory in the country, knowing that they are better off than you are,” he said.
“Not only are you not receiving a subsidy, but you’re paying a tax that no one else is paying either.”
Jafari said the subsidy’s removal could impact electric vehicle sales in Victoria despite the launch of the National Electric Vehicle Strategy and the federal government’s changes to the fringe benefits tax.
The removal of Victoria’s electric car rebate will put the state behind four major Australian states for incentives, including Queensland, which increased its means-tested subsidy to $6,000, Western Australia, which offers a $3,500 rebate, and NSW and South Australia, which offer $3,000 subsidies.
Meanwhile, the Australian Capital Territory instead offers zero-interest loans on electric vehicles, Tasmania offers a stamp duty exemption, and the Northern Territory offers discounts on electric vehicle stamp duty and registration.
Despite the rebate removal, Victorian electric vehicle buyers will still be able to claim a $500 registration discount over five years.
