Kean predicts “EV revolution” in NSW as rebates and exemptions become law

The NSW government has celebrated the passage of its landmark package of electric vehicle incentives, establishing Australia’s most populated state as also the best to buy an electric vehicle.

As we reported, legislation implementing the NSW government’s EV Strategy was passed by parliament on Wednesday, providing $3,000 rebates for eligible EV purchases, waivers of stamp duty fees and providing funding for the roll-out of a state-wide charging network, as part of a $490 million package.

NSW Treasurer and minister for energy Matt Kean, who owns a Tesla Model 3, said the measures would help NSW achieve its target of 50 per cent of new car sales being electric models by 2050.

“To achieve net zero emissions by 2050, the majority of new cars sold in NSW need to be EVs by 2035,” Kean said.

“This is the beginning of an EV revolution in NSW, with more drivers set to benefit from lower taxes and $3,000 rebates on their next EV purchase.”

“Our strategy is all about helping more drivers to benefit from the latest and best driving technology and I welcome the cross party support for the legislation,” Kean added.

The introduction of the legislation will be backdated to 1 September – as the NSW government had flagged – to ensure all eligible electric vehicles purchased since that date, allowing those that cost $68,750 and under to claim the $3,000 rebate, and those under $78,000 to also claim the stamp duty exemption.

The legislation will also allow electric vehicle drivers to take advantage of the T2 and T3 transit lanes from 1 November 2021 until at least 31 October 2022, making commutes easier for EV drivers.

NSW transport minister Rob Stokes said that in addition to supporting the uptake of electric vehicles, the policies would help to reduce air and noise pollution.

“The transport sector currently makes up one-fifth of carbon emissions in NSW, with almost half of those coming from passenger vehicles,” Stokes said.

“This policy will give the green light to industry to increase model availability and cut the costs of EVs.”

The package will also ultimately see the introduction of a road user charge for electric vehicles – at a rate of 2.5 cents per kilometre – that will be introduced from 1 July 2027, once the EV market is well established and cost parity reached.

The NSW government has delayed the introduction of the road user charge to ensure it does not de-incentivise the early adoption of electric vehicles – at a time when the EV market is attempting to establish a foothold in Australia – and to avoid the backlash currently being faced by the Victorian government which as already implemented its own regime.

The NSW government said the road user charges would eventually offset the revenue forgone through the stamp duty exemptions and the loss of fuel excise that electric vehicle drivers do not pay.

NSW premier Dominic Perrottet said the legislation would implement an important set of reforms that would align charges paid by drivers with the level to which they use the state’s roads, rather than fixed charges like stamp duty.

“This is a comprehensive suite of measures, which ensures we have the right mix in place to boost the take-up of electric vehicles and give people access to the latest technology,” said Perrottet, who has also had a drive in Kean’s EV.

“The strategy also starts us down the road of long-term tax reform as we embark on phasing out stamp duty on electric vehicles and making sure everyone who drives on our roads contributes to their funding and maintenance.”