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In many countries, fuel taxes don't go into general revenues, they are ring-fenced and allocated for road maintenance. Even if they aren't, a reduction in reven

In many countries, fuel taxes don't go into general revenues, they are ring-fenced and allocated for road maintenance. Even if they aren't, a reduction in revenue must be offset. The fact that they aren't charged taxes for use of the roads was the incentive. This is removing it in recognition that electric vehicles are now enough of a percentage of the fleet to affect tax revenue. New Zealand does the same, with diesel and commercial vehicles already paying "road user charges" (RUC) to fund road maintenance. Petrol (gasoline) vehicles pay this tax at the pump. EVs are exempt from the RUC until they represent 2% of the fleet. https://www.transport.govt.nz/area-of-interest/environment-and-climate-change/electric-vehicles-programme/ https://www.transport.govt.nz/area-of-interest/environment-a... https://www.stuff.co.nz/motoring/107372241/ev-drivers-are-bludgers-costing-nz-roads-7m-per-year https://www.stuff.co.nz/motoring/107372241/ev-drivers-are-bl...

Dumblydorr 6y ago
These are island nations without their own fuel production and good renewable potential. Wouldn't they see it's in their best interest to maximize batteries to minimize fuel imports?
- nordsieck 6y ago
  > These are island nations without their own fuel production and good renewable potential. Wouldn't they see it's in their best interest to maximize batteries to minimize fuel imports? Presumably that applies at the individual consumer level as well.
- jpollock 6y ago
  New Zealand is an oil and gas exporter. They have their own gasoline refinery as well. This doesn’t maximize batteries, it impoverishes transport budgets (public transit and reading) and is a tax rebate primarily available to the wealthy, like solar panels. There are good reasons to electrify the the transport system, but the transport network will still need to be funded.
x87678r 6y ago
Specifically Diesel in NZ is not taxed because most a huge amount used by Farmers for tractors and/or generators so RUCs were added to charge diesel trucks.
layoric 6y ago
This approach makes sense, but with Australia, EV sales are not close to 2% and are still 0.6% [0], and they are still really expensive upfront to buy. Also in Australia, the fuel tax isn’t isolated for use only for roads, it is a federal tax that can be (and has been), used for other more general expenses. In a time of “money printer goes brrr” and tax cuts disproportionately benefiting the wealthy, nickel and diming things like EVs keeping their cost higher makes little sense. I like cleaner city air for everyone, reduced CO2 etc, adding this tax will make EV choice a lot harder as you’ll be hit with a tax larger than your fuel bill total, especially if you charge off your own solar and for people who buy a second hand EV just to drive around town. A 2.5c per km is equivalent to doubling the cost of a lot of EVs, example 2015 Nissan Leaf 24kWh does ~100km on a full charge of say 20 kWh, at 15c per kWh you are looking at $3 fuel and $2.5 tax. 15c is low but with combo of solar (which is very common in Australia) or off peak this is pretty reasonable. What isn’t reasonable is that level of tax for something that has more general benefits for trying to generate such a small total of revenue at such an early stage of sales. There are so many other ways this tax could be generated in relation to cars that would encourage uptake of these cars while still reducing impact on lower/middle income earners, I think this is a very poorly thought out tax. [0] https://www.theguardian.com/environment/2020/aug/19/electric-vehicle-sales-triple-in-australia-despite-lack-of-government-support?CMP=Share_iOSApp_Other https://www.theguardian.com/environment/2020/aug/19/electric...
- fy20 6y ago
  I don't know what fuel prices are like in Australia, but here in Europe I pay around €0.05/km to fuel my ICE car. Taxes make up around 70% of that, so an EV tax of €0.015/km (1 AUD = 0.6 EUR) wouldn't be unreasonable once everyone is driving EVs. As you say there's probably a better way to tax it though (it doesn't make sense someone with a Tesla Model X pays the same as someone with a Renault Zoe). If you drive 100,000km over the lifetime of your car (this is just a nice round number for examples sake) that's only €1500 in tax revenue. Higher taxes on the sale of large and luxury cars could generate the same revenue with little impact on the overall price (if you are already planning to spend €50k+ on a new car).

Dumblydorr 6y ago

These are island nations without their own fuel production and good renewable potential. Wouldn't they see it's in their best interest to maximize batteries to minimize fuel imports?

nordsieck 6y ago
> These are island nations without their own fuel production and good renewable potential. Wouldn't they see it's in their best interest to maximize batteries to minimize fuel imports? Presumably that applies at the individual consumer level as well.
jpollock 6y ago
New Zealand is an oil and gas exporter. They have their own gasoline refinery as well. This doesn’t maximize batteries, it impoverishes transport budgets (public transit and reading) and is a tax rebate primarily available to the wealthy, like solar panels. There are good reasons to electrify the the transport system, but the transport network will still need to be funded.

x87678r 6y ago

Specifically Diesel in NZ is not taxed because most a huge amount used by Farmers for tractors and/or generators so RUCs were added to charge diesel trucks.

layoric 6y ago

This approach makes sense, but with Australia, EV sales are not close to 2% and are still 0.6% [0], and they are still really expensive upfront to buy. Also in Australia, the fuel tax isn’t isolated for use only for roads, it is a federal tax that can be (and has been), used for other more general expenses. In a time of “money printer goes brrr” and tax cuts disproportionately benefiting the wealthy, nickel and diming things like EVs keeping their cost higher makes little sense. I like cleaner city air for everyone, reduced CO2 etc, adding this tax will make EV choice a lot harder as you’ll be hit with a tax larger than your fuel bill total, especially if you charge off your own solar and for people who buy a second hand EV just to drive around town. A 2.5c per km is equivalent to doubling the cost of a lot of EVs, example 2015 Nissan Leaf 24kWh does ~100km on a full charge of say 20 kWh, at 15c per kWh you are looking at $3 fuel and $2.5 tax. 15c is low but with combo of solar (which is very common in Australia) or off peak this is pretty reasonable. What isn’t reasonable is that level of tax for something that has more general benefits for trying to generate such a small total of revenue at such an early stage of sales. There are so many other ways this tax could be generated in relation to cars that would encourage uptake of these cars while still reducing impact on lower/middle income earners, I think this is a very poorly thought out tax. [0] https://www.theguardian.com/environment/2020/aug/19/electric-vehicle-sales-triple-in-australia-despite-lack-of-government-support?CMP=Share_iOSApp_Other https://www.theguardian.com/environment/2020/aug/19/electric...

fy20 6y ago
I don't know what fuel prices are like in Australia, but here in Europe I pay around €0.05/km to fuel my ICE car. Taxes make up around 70% of that, so an EV tax of €0.015/km (1 AUD = 0.6 EUR) wouldn't be unreasonable once everyone is driving EVs. As you say there's probably a better way to tax it though (it doesn't make sense someone with a Tesla Model X pays the same as someone with a Renault Zoe). If you drive 100,000km over the lifetime of your car (this is just a nice round number for examples sake) that's only €1500 in tax revenue. Higher taxes on the sale of large and luxury cars could generate the same revenue with little impact on the overall price (if you are already planning to spend €50k+ on a new car).