Electric Vehicle Council boss Behyad Jafari has hit back at claims that EV drivers in Australia were being given an unfair “advantage” over drivers of petrol cars because they did not pay a fuel excise.
The comments were made last week by Australian Competition and Consumer Commission chief Rod Sims, in a speech calling for road pricing reform, in particular in light of the emergence electric vehicles.
“At the moment electric vehicle owners aren’t paying existing road user charges and everyone driving a petrol car is. That is clearly not fair,” Sims said, in comments previewed in the AFR.
“Why should [electric vehicle drivers] have an advantage over people driving petrol cars?” Sims asked.
But Electric Vehicle Council chief Behyad Jafari said on Monday that Sims’ view failed to consider key factors, including the health cost to taxpayers from internal combustion engine emissions, recently put at $3 billion in the Sydney-Newcastle-Wollongong area, alone.
“Far from getting an unfair advantage, electric vehicle drivers should be asking why they don’t derive any reward for saving the taxpayer thousands on health costs each year,” Jafari said, pointing to latest data showing EVs could shave health costs by $2,400 per vehicle.
“As things stand, (Sims’) argument is a like claiming smokers unfairly subsidise the health system because of all the tax they pay on cigarettes.”
“There’s no doubt a mass transition to electric vehicles will require long-term reform in the way governments collect revenue for roads.
“But as things stand the minority of drivers who are making the switch to EVs are doing vastly more good than harm to the economy and the public good.
“We would encourage Mr Sims to update his thinking, and his lines, when it comes to this important issue.”
Australia is well behind the global curve on EV uptake, with consumers choosing to make the switch faced with few vehicle choices and mostly premium prices.
Further, Australia is one of the few developed nations without any federal government subsidies or incentives to drive the uptake of electric vehicles, despite the urgent need to reduce national emissions.
Sims also argued that a road users tax should be introduced, instead of a fuel tax, as an equitable way to raise revenue for transport infrastructure that encompasses both electric and petrol cars.
“My position has consistently been we need to find a way to introduce hypothecation; that is, road-related revenues such as fuel excise should be dedicated for use on roads,” Sims said.
“Only then can we think of different ways to improve road pricing. It is a key starting point that is still being completely missed in this crucial debate. People must see that what they pay for road use is spent on roads.”
This is not a new or unreasonable concept. But according to former Senator Tim Storer, who headed up the recent Senate Inquiry into electric vehicles, such a tax should not be introduced until 2025-26, when the EV costs were expected to be broadly at price parity with petrol and diesel equivalents.
“As the contribution of fuel excise to the cost of building and maintaining our roads declines, it is only equitable that owners of EVs make a contribution to our transport infrastructure,” Storer said earlier this year.
“EVs are projected to achieve price parity with ICE vehicles by the middle of the coming decade, so it would be responsible and equitable policy to delay the introduction of a Road User Charge for EVs until 2025-26.”