Electric Vehicle Council slams Productivity Commission call to scrap EV incentives

Australia’s Electric Vehicle Council (EVC) has pushed back on the Productivity Commission’s call to phase out specific electric vehicle (EV) incentives, saying that such a move could “slam the brakes” on EV uptake across the country.

The Productivity Commission (PC) published a major new report this week, the second of five reports it is expected to make over the next two weeks. The report – Investing in cheaper, cleaner energy and the net zero transformation – calls for consistent incentives and faster approvals to better secure Australia’s net zero transformation.

“With the right policy settings, we can limit the costs of decarbonising and speed up our approvals to unlock the opportunities of lower cost, more abundant clean energy,” said Barry Sterland, PC commissioner.

“We can also boost our resilience to the effects of climate change and minimise their human and economic costs.”

Amongst the draft recommendations made to the government, however, was a call to phase out the exemption of EVs from the Fringe Benefits Tax Scheme, and for state and territory governments to phase out the exemption of EVs from vehicle stamp duty and registration discounts.

“The Commission’s report gets one thing right and one thing very wrong,” Julie Delvecchio, EVC CEO, who applauded the PC’s recommendation of a new emissions-reduction incentive to cover heavy vehicles which are not captured by the Safeguard Mechanism.

“It rightly recommends targeted support for zero-emissions trucks but then inexplicably turns around and proposes scrapping the very incentives that are finally helping everyday Australians afford an electric car.”

These recommendations, according to Delvecchio, send mixed signals at what is a critical juncture in the electric transition.

“If we’re serious about net zero, we need to accelerate – not decelerate – the shift to clean transport. That means backing in the policies that are working,” said Delvecchio.

“The Electric Car Discount has been a game-changer, especially for fleets and everyday workers who couldn’t previously afford to go electric. Removing it now would be like ripping out the charging cable halfway through the trip.

“If we want to see more EVs on our roads and reduce emissions, we need to do much more. We need to increase EV uptake and that means expanding purchase incentives like the Electric Car Discount and state-based discounts, not removing them.

“Suggesting we end incentives just as Australia finally catches up to the rest of the developed world with an efficiency standard is short-sighted. We need both – they work together, not in isolation.”