Coalition of the EV-willing calls for stamp duty on electric cars to be abolished

A coalition of the EV-willing are calling on the South Australian parliament to permanently abolish stamp duty on electric vehicles, in an open letter published today in the local newspaper.

Twelve organisations signed the letter, including car manufacturers, automotive groups and environmental organisations. The list includes the Electric Vehicle Council, South Australian entrepreneur and EV enthusiast Simon Hackett, the Conservation Council of SA and The Australia Institute.

Abolishing stamp duty, the group said, would help support greater electric vehicle uptake in the state, which has recently flagged a $3,000 rebate for new EV purchases, but only for the first 4,000 vehicles.

With the purchase price of electric vehicles ranging upwards from $40,000, stamp duty can add a couple of thousand dollars to the upfront cost.

Stamp duty is “not insignificant” as an additional cost when purchasing a new vehicle Noah Schultz-Byard, South Australian director of The Australia Institute, told The Driven.

He said, “stamp duty is a very large one-off hit to a family’s budget, when they’re making a significant purchase”.

Abolishing stamp duty would also align South Australia’s approach on electric vehicle incentives and charges with New South Wales, he said, with both states delaying the introduction of road user charges to 2027. The Tasmanian (Liberal) and ACT (Labor/Green) governments also offer stamp duty exemptions.

“All we’re asking South Australia to do is look across the border at their Coalition government cousins in New South Wales and adopt the same package,” Schultz-Byard said.

Behyad Jafari, chief executive of the Electric Vehicle Council told The Driven removing stamp duty on vehicles is not a new idea. 

“Governments and economists have long said that stamp duty is an outdated and inefficient tax and it should be removed”, he said. 

“Electric vehicles help to tackle climate change, lower our daily transport costs and improve the quality of the air we breathe. It is high time we made the switch to electric”.

RMIT urban policy professor Jago Dodson told The Driven he was “broadly supportive” of incentives like stamp duty reductions that make it relatively cheaper to purchase an electric vehicle compared to a conventional combustion vehicle.

“It’s preferable to have electric vehicles on the roads than internal combustion vehicles because you’re getting all the climate benefits from that”, he said.

However, Dodson supports the introduction of road user charges for electric vehicles as a reasonable approach to moderate levels of driving in cities by placing a per kilometre cost on using your car.

Victoria has controversially introduced such a charge, but NSW and South Australia have deferred such charges until at least 2027 until electric vehicles become more popular.

Dodson said we should be transitioning away from conventional vehicles, to “some travel by electric vehicles, but a much greater proportion of travel should be picked up by public transport and active travel modes.”

“We want to convert the vehicle fleet to electric as soon as possible”, Dodson said, but then the best thing for cities is “fewer vehicles on our roads overall” because of “all the other harms that automobiles generate” such as congestion, safety, environmental pollution from tyre wear and space allocated to parking.