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Green light for SA EV tax

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A levy on electric and plug-in hybrid vehicles has passed South Australia’s parliament despite opposition from Labor, the Greens and industry groups – although the State Government has agreed to offer more incentives for the purchase of low-emission cars.

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The tax, which passed its biggest hurdle in the Upper House with the support of SA-Best and Advance SA MLC John Darley, will see EV owners paying an additional 2.5-cent per kilometre charge when they pay their registration fee in 2028.

Under the scheme, an EV owner that travels 12,200km – an average yearly travel distance – will pay a total of $443 in annual registration costs ($305 from the road user charge plus $138 for standard registration).

Plug-in Hybrid owners will also be slugged with a 2-cent per kilometre levy, with the charges also set to rise as they are indexed with the consumer price index.

But the State Government has also agreed to throw in another $3 million to subsidise the purchase of a further 1000 EVs and waive motor registration fees on the vehicles until 2025.

The changes have increased the size of the government’s overall EV package to $41 million, with $3000 government subsidies now on offer for the purchase of 7000 EVs.

Treasurer Rob Lucas on Thursday hailed the “groundswell of support” for the government’s EV package, after earlier in the year saying the government didn’t have the numbers to pass a previous version of the Bill.

“The pace of change is overwhelming – where the future is zero emissions, the future is electric vehicles,” he said.

“We welcome the groundswell of support from the Parliament and key industry bodies, including the RAA, for our important reforms which will help drive the take-up of environmentally friendly zero and low emission vehicles while ensuring there is a long-term sustainable model for critical road funding.”

Lucas said additional incentives followed further consultation with industry.

He also said a select committee would be set up one year after the commencement of the Act to examine issues such as EV infrastructure, training and battery disposal.

It comes despite opposition from the Labor, the Greens and industry groups on the proposal.

Greens MLC Robert Simms said the tax would be a “disincentive for motorists considering electric vehicles during this time of climate crisis”.

“It’s appalling that SA is now one of the few places in the world with a tax like this in place. It’s an embarrassing day for South Australia,” he said.

Car manufacturers including Mitsubishi and Volkswagen have also previously expressed their opposition to the South Australian proposal.

EVs currently make up less than one per cent of new car sales in South Australia. The tax will be introduced earlier if EVs and plug-in Hybrid vehicles reach 30 per cent of new purchases before 2027.

An analysis from the Australia Institute this week found South Australia’s EV package, when adjusted for population and economy size, is roughly $70 million less than an equivalent program in New South Wales.

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