RUCs to apply to all vehicles (incl EVs), replacing road user tax on petrol

Forums › Transport (cars, bikes and boats) › RUCs to apply to all vehicles (incl EVs), replacing road user tax on petrol

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#3183950 19-Jan-2024 13:19

If you consciously bought a PHEV then your rationale would have been, I can drive the car every day on battery (nightly charging) and only need petrol when I am doing a long distance drive. Or one day I have to make a longer run, then I have no range angst.

Then you are unlikely to be disadvantaged too much by RUC since you will only use petrol for the long drives.

If however, you bought the PHEV and then can't be bothered to charge it each night treating it as a ICE (I had read many users in the US do this) then you need to change your behaviour if you don't want to be financially impacted too much.

703

131 posts

Master Geek

#3187039 26-Jan-2024 19:31

Well new EV's have been subsided $8,625.

That is many years of RUC, if 5000KM / Year that is 13 Years of RUC paid for by the Govt/Tax Payers. More than the lifetime of the EV.

everettpsycho

614 posts

Ultimate Geek

#3187060 26-Jan-2024 21:23

703:
Well new EV's have been subsided $8,625.

That is many years of RUC, if 5000KM / Year that is 13 Years of RUC paid for by the Govt/Tax Payers. More than the lifetime of the EV.

That was not how the rebate scheme was meant to work. A significant portion of those rebates (the aim was all of it) was paid for by people buying inefficient vehicles and being charged extra to register them. Yes it was from the government but the scheme was not purely funded by tax money. Now they stopped the rebates and the additional charges together the treasury is not financially benefitted at all, the only people who benefitted were those buying big petrol engines who can pay less.

scuwp

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#3187077 26-Jan-2024 23:27

That was not how the rebate scheme was meant to work. A significant portion of those rebates (the aim was all of it) was paid for by people buying inefficient vehicles and being charged extra to register them. Yes it was from the government but the scheme was not purely funded by tax money. Now they stopped the rebates and the additional charges together the treasury is not financially benefitted at all, the only people who benefitted were those buying big petrol engines who can pay less.

The discount scheme paid out $615M, and only collected $297M. The scheme was being heavily subsidised by the general taxpayer. It's no wonder this government shelved it quickly given they want to reign in expenditure.

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SaltyNZ

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#3187082 26-Jan-2024 23:32

scuwp:

The discount scheme paid out $615M, and only collected $297M. The scheme was being heavily subsidised by the general taxpayer. It's no wonder this government shelved it quickly given they want to reign in expenditure.

If that was their problem, they could have scrapped the rebate but kept the fees.

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Technofreak

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#3187087 26-Jan-2024 23:52

SaltyNZ:

scuwp:

The discount scheme paid out $615M, and only collected $297M. The scheme was being heavily subsidised by the general taxpayer. It's no wonder this government shelved it quickly given they want to reign in expenditure.

If that was their problem, they could have scrapped the rebate but kept the fees.

I'm not sure that was a realistic option. I can see the flaw with it if you cannot. If one was to offset the other but only one half was cancelled I can see the out cry that would cause. The system wasn't working as it was sold to the public.

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Mattnzl

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#3187115 27-Jan-2024 07:49

The discount scheme paid out $615M, and only collected $297M. The scheme was being heavily subsidised by the general taxpayer. It's no wonder this government shelved it quickly given they want to reign in expenditure.

That's partly due to the fact that the rebate started earlier (1 Jul 2021) than the fee (1 April 2022)

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HarmLessSolutions

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#3187179 27-Jan-2024 09:22

Mattnzl:

The discount scheme paid out $615M, and only collected $297M. The scheme was being heavily subsidised by the general taxpayer. It's no wonder this government shelved it quickly given they want to reign in expenditure.

That's partly due to the fact that the rebate started earlier (1 Jul 2021) than the fee (1 April 2022)

Also the payment side for high emission vehicles pretty much stalled as soon as the public got a sniff of a potential change in government as they just delayed purchasing such vehicles knowing the penalty was going to cease, and the inverse was the case for EVs and hybrids. The whole viability of the scheme's original intent went belly up at that stage.

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SaltyNZ

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2degrees

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#3187205 27-Jan-2024 10:28

HarmLessSolutions:

Also the payment side for high emission vehicles pretty much stalled as soon as the public got a sniff of a potential change in government as they just delayed purchasing such vehicles knowing the penalty was going to cease, and the inverse was the case for EVs and hybrids. The whole viability of the scheme's original intent went belly up at that stage.

That's true, but it works other places around the world. If they had held their nerve (and perhaps adjusted things, as they had already started to, as was built into the scheme from the beginning, to equalise the cash flows) then one of two things would happen: either people would give up and buy the ICE and pay the fees, or they wouldn't buy the ICEs, the EV utes would arrive, and they would buy those.

The entire point of the scheme was to encourage people to buy EVs. It worked.

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lchiu7

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#3187271 27-Jan-2024 13:35

SaltyNZ:

The entire point of the scheme was to encourage people to buy EVs. It worked.

Yup. I was in the market for a new car and the scheme tipped the scales for me in terms of ICE versus EV. Not looking back at all.

paulchinnz

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#3187449 27-Jan-2024 17:54

SaltyNZ:

The entire point of the scheme was to encourage people to buy EVs. It worked.

That's a strong assertion. What's the definition of 'it worked'? It looks like around 20% of passenger vehicle registrations in 2022 and 2023 were EVs, which leaves 80% on fossil fuels (MIA > Sales Data > Vehicle Sales), leading to a grand total of ~100k EVs/PHEVs out of >4 million vehicles on the roads in NZ. Further, what was its contribution towards the year on year increase in EV registrations, given other covariates for uptake such as the increasing choice of EVs available?

Obraik

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#3187454 27-Jan-2024 18:25

paulchinnz:

That's a strong assertion. What's the definition of 'it worked'? It looks like around 20% of passenger vehicle registrations in 2022 and 2023 were EVs, which leaves 80% on fossil fuels (MIA > Sales Data > Vehicle Sales), leading to a grand total of ~100k EVs/PHEVs out of >4 million vehicles on the roads in NZ. Further, what was its contribution towards the year on year increase in EV registrations, given other covariates for uptake such as the increasing choice of EVs available?

20% was quite an increase in EV registrations over the years prior to the rebate.

Were you expecting it to be 100%?

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paulchinnz

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#3187464 27-Jan-2024 19:46

Haha clearly not 100%, just wondering what data this conclusion that 'it worked ' is based on. How much of that 20% was driven (pun intended) purely by the Clean Car Discount? A multivariate regression analysis by someone who knows what they're doing would be useful ;p

Obraik

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#3187471 27-Jan-2024 20:20

paulchinnz:

Haha clearly not 100%, just wondering what data this conclusion that 'it worked ' is based on. How much of that 20% was driven (pun intended) purely by the Clean Car Discount? A multivariate regression analysis by someone who knows what they're doing would be useful ;p

In the first 6 months of the CCD, there was a 210% increase in EV sales compared to the 6 months prior, which put the total registered EVs in NZ to around 35k. Since then, as of the end of 2023 that registered number was now around 73k

The CCD had other knock-on effects though too. Thanks to the increased demand, we had a lot more EV options come our way that likely would have been redirected to Europe that also has successful incentive programs - many of these options haven't even made their way to Australia yet. With that extra competition has seen prices of new EVs dropping, during a time when everything else seemed to be going up in price. NZ was one of the cheapest countries to buy many of these EV models (before the rebate was taken off the prices)

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paulchinnz

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#3187558 28-Jan-2024 09:47

Thanks and yeah agree with all those numbers. The trouble is that none of that proves causation, unless eg one claims that there are no other contributors to the increase. Correlation is not causation. If anyone's seen an analysis that untangles the other contributors, I'd be keen to be pointed towards that thanks.

Also the numbers are small in the context of over 4 million vehicles in NZ. I guess if the government said prior to implementation that 73k cars was the target after 2 years then one could more legitimately claim that it worked. However it's only 2y of data - was the rate of increase going to decline after the honeymoon of EV enthusiasts taking advantage of the Discount ended ie a hypothesis is that for most people it'll take more than the Discount to tip them towards buying an EV, and those who bought an EV in 2022/23 were already keen on getting an EV.

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