Researchers from Monash Business School and Griffith University are encouraging the Australian government to review taxation law to support the affordability of EVs and charging infrastructure.

The Reliable Affordable Clean Energy for 2030 (RACE for 2030) co-operative research centre, have awarded $220,000 to Dr Kraal from Monash Business School and Dr Mortimore from Griffith University to investigate taxation solutions to fix the lack of home charging infrastructure and affordability as top barriers to the adoption of battery electric vehicles (BEVs) for business fleets.

It follows the federal government allocating $25 million to drive EV uptake with a ‘technology not taxes’ approach.

The two doctors are researching how the transition to emissions reduction should be facilitated by the Australian taxation system together with advancements in technology.

Transport is responsible for nearly a fifth of Australia’s total CO2 emissions. Transforming business fleets to comprise clean energy vehicles would be a huge step forward in national emissions reduction, Dr Kraal says: “In 2020, Australian business fleets acquired mostly petrol and diesel vehicles, resulting in the sector producing a higher weighted average CO2 emissions, 185 grams of CO2 emission per kilometre, 41% higher than Europe in 2018.

“Given business fleets make up the majority of passenger and light commercial cars on the road, we feel there’s greater impact in focusing on fleet vehicles.”

Dr Mortimore says that accelerating the uptake of BEVs by business will not only allow fleet employees to experience driving and charging fleet BEVs without owning one, but will also add to the supply of more affordable BEVs to private customers.

The project, titled ‘Business fleets and EVs: Taxation changes to support home charging from the grid, and affordability’ will look at how taxation support is the key to exponentially increasing BEVs in fleets.

The project is examining the increased takeup of BEVs in fleets overseas. The incorporation of zero-emission vehicles in the fleet mix is an area where Australia is lagging behind much of the world.

“Currently, BEV technology is not affordable in Australia and workplace charging infrastructure is either low or non-existent. Our project will investigate the barriers to business fleets uptake of BEVs through taxation changes and incentives that will address affordability and enable fleet employees to charge their BEVs at home,” Dr Mortimore says.

The UK, France, Germany, Denmark, Norway and Italy all have a significant penetration of BEVs, when compared to Australia, as a result of government tax support Dr Kraal adds.

As far back as 2012, the EU government has been paving the way for widespread BEV usage in fleets by granting widespread tax relief for business users to charge their cars. In 2021, there is a stronger focus on BEVs over hybrid models.

“The Australian government has already acknowledged that business fleets are an effective pathway for early adoption of EVs. However, there needs to be clear guidance on how to implement incentives and how new technologies will be treated from a taxation perspective for those that use their vehicles for business purposes,” adds Dr Kraal.