Labor’s free ride for electric cars, other drivers pay $650 a year

Labor says drivers of electric vehicle will be able to use roads free of charge for the foreseeable future under its plan to lift EV sales.

Opposition Treasury spokesman Chris Bowen confirmed Labor had not yet considered whether to make EV drivers pay a road user charge to claw back lost fuel excise revenue. Picture: AAP

Labor says drivers of electric ­vehicles will be able to use roads free of charge for the foreseeable future under its blueprint to lift EV sales to 50 per of new cars sold by 2030, as new figures reveal owners of petrol-driven cars pay more than $650 a year in fuel excise to maintain the road network.

Tuesday’s budget showed Treasury expects to raise $19.7 billion from the 41.2c-a-litre fuel excise in 2019-20, of which about $7.5bn will be handed back to ­exempt users, including farmers and miners, leaving a net tax take of about $12.2bn.

The Australian Automobile Association said that, based on the latest figures, an average driver travelling 15,000km a year in an internal combustion car would pay $654 a year in fuel excise. The owner of a 2017 Toyota Corolla driving the same distance would pay about $380 a year, while a 2017 LandCruiser driver would pay about $836.

The fuel excise take — the ­nation’s biggest source of road-­related funding — will decline significantly as drivers switch to EVs, prompting the Productivity Commission to recommend in 2017 that the government introduce a new direct road user charge based on kilometres travelled.

But opposition Treasury spokesman Chris Bowen confirmed Labor had not yet considered whether to make EV drivers pay a road user charge to claw back lost fuel excise revenue.

“We’re talking 2030, so we’re some years off,” Mr Bowen said.

He said Labor would only consider a road user charge in a “sensible and mature” way if there was bipartisan agreement over the measure. “Anthony Albanese and I have said consistently for a ­period of years that that’s a conversation that shouldn’t be made a partisan one,” Mr Bowen said.

Electric Vehicle Council CEO Behyad Jafari said EV owners ­acknowledged they should pay to use the nation’s roads.

But he said the vehicles should continue to avoid a road user charge until about 2025, when the cars were expected to become cost-competitive with equivalent internal combustion vehicles.

“Before that time, up to 2023 or 2024, (the government) should be supportive of electric vehicles, and after that time when they take off by themselves, you can withdraw all of those incentives.

“But importantly that doesn’t mean starting a discussion about road user charging in 2025. It means start it now so you have an orderly transition from one system to another.”

Scott Morrison yesterday ridiculed Labor’s electric car plan, agreeing with 2GB broadcaster Alan Jones that the policy was an “economic suicide note”.

“It is, Alan. I couldn’t agree with you more on that,” the Prime Minister said. “Frankly, they want to tell you what car to drive. This will put up the price of everything.”

He said earlier in the week that the fact EV owners did not pay fuel excise was a “significant leg-up” for the rollout of the cars.

AAA chief executive Michael Bradley said both sides of politics had to come up with a plan to ensure all vehicles on the roads paid their way.

“The AAA supports transitioning towards road user charging for all vehicles, starting with investigating a mechanism for bringing ultra-low fuel consumption vehicles, including electric vehicles, into the road user charging system,” he said.

“That should be followed by a full reform process for all light vehicles, which is implemented in a manner that ensures no disincentive to the take-up of ultra-low fuel consumption vehicles.”