In light of EV taxes being developed in several states and now before the Victorian parliament, Ai Group chief executive Innes Willox says the move is effectively “putting the cart before the horse” and “shouldn’t be implemented until clean vehicles are better established”.

“Road infrastructure needs to be paid for and it will be important in the long term to maintain the tax base as batteries and fuel cells replace petrol tanks in Australia’s vehicle fleet,” Innes adds.

“But Australia is currently well behind our peers in that transition. Our slow uptake of clean vehicles is holding back national progress towards emissions targets – and increasing the pressure on every other part of the economy to deliver cuts.”

He adds that now is the time to further incentivise businesses and individuals to access cleaner vehicles.

“All sides of politics have the opportunity to develop coherent, and preferably nationally coordinated, incentives that are consistent with overall plans for achieving a net zero emissions economy by 2050,” he says.

“Unfortunately, the most advanced EV tax proposal, Victoria’s tax proposed to start on 1 July this year, looks like a major disincentive that would undermine any other supportive policies. Victoria will soon set medium-term emissions targets, and they should be as high as the state can achieve without leaving vulnerable businesses, communities, workers and households behind. Holding back transport transition will make it harder to achieve those targets. The problem is not just the rate, but the red tape and paperwork involved in clunky new reporting arrangements.

“Victoria and the rest of the States should slam the brakes on these taxes and spend the next several years working together with the Commonwealth on a solution that is roadworthy. That road pricing work should prioritise national consistency; ease of use; and effective incentives both for efficient road use and emissions reduction.”