Electric vehicle tax cut passes Senate

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Thousands of dollars will be slashed from the price of some electric vehicles in Australia after the Senate approved a tax cut following last-minute negotiations with heterogeneous senators.

The electric discount car bill is expected to pass on Friday after the Senate voted in favor of the proposal by a 31-24 vote.

The new law is expected to reduce employee benefit taxes for electric vehicles costing less than $84,916.

Under the new rules, employers could save up to $12,500 on the cost of a set of electric vehicles for an employee, while individuals could save $4,300 on the purchase of a $64,000 vehicle. , according to Treasury estimates.

Once approved by Parliament, the tax cuts will be backdated to July 1 this year.

But the rebates were only passed after negotiations between the Labor government, the Greens and Independent Senator David Pocock over whether plug-in hybrid vehicles should benefit from the rebate.

Plug-in hybrid vehicles feature both electric motors and internal combustion engines, and independent senators have argued that the bill should not subsidize gasoline-powered vehicles.

Agreement on the law will end the hybrid vehicle tax cut in April 2025 and give priority to battery electric vehicles in Commonwealth fleets.

Mr Pocock told the Senate that reducing the tax on electric cars was key to accelerating carbon reductions in Australia and addressing cost of living issues for motorists.

“The slow adoption of electric vehicles is costing Australians money,” he said.

“It’s costing Australians money every time they go to the gas pump, and it’s doing damage to our climate. We need to look at the transition to electric vehicles in the context of climate change. That’s something something we need to accelerate quickly.”

Coalition senators opposed the new laws, however, with Liberal Sen. Matt O’Sullivan questioning whether electric vehicles were too heavy, whether they would strain the power grid and arguing that they could not derive large loads over long distances.

“Some on the other side may say, ‘Well, only 10% of Australians could plug in a caravan or a heavy load at the weekend,'” he said.

“My answer to that is: if Labor wants to penalize those in that 10% and add further pressure to their daily cost of living for simply having the temerity to own a caravan, then they have to be upfront with them.”

Despite opposition, Electric Vehicle Council chief executive Behyad Jafari called it a “historic moment” for Australia’s transport industry that would not only encourage more companies to buy electric fleets, but who would “turbocharge” the used electric car market.

“This bill will allow thousands more Australians to get behind the wheel of an electric vehicle where they can enjoy the benefits of lower fuel bills, reduced pollution and a driving experience. fun ride,” he said.

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