Victoria in shock move to scrap $3,000 electric vehicle rebate

In a disappointing surprise for would-be EV customers, the Victorian government will end its $3,000 Zero Emission Vehicle (ZEV) subsidy this month, ahead of schedule and well below the government’s promise of 20,000 allocations.

The early end to the subsidy was actually included in the state’s budget papers which were released on May 23, but escaped notice until now. There was, predictably, no official press release coming from the government.

Victoria’s $3,000 ZEV subsidy was announced in May 2021 when the Victorian government came under fire after it announced its plan to implement an EV road tax.

“The subsidy will be available for more than 20,000 new ZEV purchases from Sunday, 2 May 2021,” it said at the time. “Subsidies will be available in stages, with an initial 4,000 spots. Further stages will be announced as the program progresses.”

As of  April 15 this year, only 7,692 ZEV subsidies had been allocated in Victoria according to DEECA (Department of Energy, Environment and Climate Action) and sourced by Carloop.

With less than 3000 EVs sold in Victoria since then it appears the Victorian ZEV subsidy scheme is being cut well below the promised figure of 20,000 in the 2021 announcement.

“It is disappointing that the Victorian Government has taken another backward step on EVs, despite their own target of achieving 50 per cent zero-emission vehicle sales by 2030,” said the Electric Vehicle Council in a press release in response to the news.

“As a result of this move, potential EV buyers in Victoria will not only lose access to the $3,000 subsidy but will still pay around $1,600 through Victoria’s EV tax over 5 years.”

The road user charge, described as “the world’s worst EV policy” imposes a tax of 2.6c (up from 2.5c) for every kilometre driven by EVs inside or outside the state of Victoria. It also applies to plug in hybrids, although at a different rate (2.1c/km).

Many drivers have expressed their frustration. EV owners told to send in odometer readings for road tax, and they are not happy

In March it was revealed that that Victoria’s EV tax was actually taking EVs off the road. At the time VicRoads Registration and Licensing Services chief operations officer Michael Hooper was quoted in an AAP report as saying 243 car registrations had been cancelled since the law was introduced.

With the ZEV subsidy coming to an end this month there is now a net disincentive to EV ownership in Victoria.

While the Victorian government scraps its EV subsidy, other states are increasing theirs.

In April Queensland doubled its electric vehicle rebate to $6,000. “We want more zero emission vehicles on Queensland roads with Queensland families to have access to cheaper and cleaner vehicles,” said minister for energy, renewables and hydrogen Mick de Brenni at the time.

The Driven has reached out to the Victorian government and will update this story with their response.