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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#3127627 14-Sep-2023 11:02

alasta:

Dingbatt:

At the current rate for public charging (approx 80c/kWh) once you add RUCs (@ 7.6c/km) it would be more expensive* to run an EV than an efficient ICE (especially HEVs). This becomes a disincentive to the uptake of EVs for people without access to reasonably priced electricity for charging.

I have just been through this exercise. Electric isn't financially viable if you can't charge at home, and I couldn't find any hybrids that I liked and were readily available. I have always owned Mazdas so I took a CX-30 for a test drive and managed to get under 6.5l/100km under sedate driving according to the (admittedly not perfectly accurate) trip computer so I ended up ordering one of those.

I really only use the car for long trips, or when carrying cargo, otherwise I'm happy to just walk or take the bus to limit my carbon footprint. On that basis I have no objection to paying an additional carbon tax on my fuel purchases, but it would be nice if that revenue could be recycled back into public transport and walking infrastructure.

Yep at current prices BEV are uneconomic if you don't drive a lot and don't charge at home. What kind of drive got you 6.5L/100Km - was it a bit stop-start as it doesn't sound great for a small car? My heavy diesel SUV can get close to that (7.0L/100Km) on a commute to work in ideal conditions (Remuera to East Tamaki using SH1, no congestion) and will get under 7 on a long highway trip. However if there is traffic congestion the commute could be 9. Over the 800 or so Km between monthly fills it generally averages about 9 or 10 with an average speed of around 30kph. Suburban stop-start traffic traffic kills the economy for heavy ICE vehicles and that's where BEVs really do well.

I don't like fuel or mileage taxes going to PT and walking infrastructure. Those things are a public good so the expense should be spread over the public purse. I.e. funded through general taxation. A plumber's van or delivery vehicle should not be subsidising PT, cycleways and pedestrians.

Dingbatt

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#3127630 14-Sep-2023 11:11

johno1234:

Yes that is exactly right. But damage accumulates. Very few large trucks drive through my neighbourhood - just small home delivery vehicles very occasionally. Yet even neighbourhood roads require maintenance. Cars should contribute too. The RUC should be weighted so the costs reflect the expenses it covers. If replacing petrol excise it would be apportioned not just to road maintenance but also ACC, climate and so on.

I’m not suggesting cars shouldn’t contribute to road maintenance. What I am suggesting is the difference in effect that a 1 ton vehicle has compared to a 3.5 ton one is so infinitesimal that to differentiate in fee is ridiculous. So charging more for the extra weight of the battery is also ridiculous. If you are going to do that then you would also need to put a surcharge on high grip tires that are on many 4WD vehicles as they have a much greater impact on the road surface than ordinary road tires.
Since EV batteries are an extra cost of approx $30000, of which about $4000 is GST, I’m happy for the additional burden my 500kg battery puts on the roading system is taken out of that.

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frankv

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#3127631 14-Sep-2023 11:13

Dingbatt:

At the current rate for public charging (approx 80c/kWh) once you add RUCs (@ 7.6c/km) it would be more expensive* to run an EV than an efficient ICE (especially HEVs).

It's bizarre that you can run an ICE-powered generator (which is what a HEV essentially is) and produce electricity about the same price that you can buy it. I suspect that this is the result of a capitalist "charge at least as much as the competition" practice. Obviously this creates an incentive to charge your EV at home and only use the three-times-as-expensive public chargers when away on trips. And it creates an opportunity for (say) cafes & motels to install chargers to sell cheaper power to attract custom. If you get a 40kWh charge, if it's about at cost it would comfortably pay for a meal.

Mantis

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#3127632 14-Sep-2023 11:15

Just renewed my car rego and noticed that all admin fees are increasing from 1 October 2023. Online fees for RUC's is increasing from $4.80 to $12.44, so for those buying 1000 km at a time ($76 + fees), this fee will account for 14% of the total cost, which again will disproportionately affect those on lower incomes purchasing smaller amounts.

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#3127638 14-Sep-2023 11:27

Just out of interest, do IRD charge a fee to collect your tax (I’m a PAYE worker). Or are the administration costs paid from the consolidated fund? Road User Charges are effectively a ring-fenced tax (which I assume you pay GST on).

“We’ve arranged a society based on science and technology, in which nobody understands anything about science technology. Carl Sagan 1996

tcabw

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#3127644 14-Sep-2023 11:37

I haven't read through all the replies, but I support RUC for all vehicles, my reason being........

I own a diesel Ford Focus which has a fuel rating of 5.5 lt / per 100km which is pretty fuel efficient. I also have a house on a 3 acre block which requires machinery (mowers/log splitter/generator etc) to maintain it which are petrol driven using well over $1000 of fuel per year. Back in the old days, one could claim a rebate for fuel used off-road, but Rogernomics killed all that.
In fairness, all vehicles that use the road, should pay road tax and you can argue till the cows come home the levels of implementation. Fuel purchased for off-road purposes should not be taxed other than GST.

That's my two bobs-worth.

Tony C

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Qazzy03

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#3127647 14-Sep-2023 11:48

Mantis:

Just renewed my car rego and noticed that all admin fees are increasing from 1 October 2023. Online fees for RUC's is increasing from $4.80 to $12.44, so for those buying 1000 km at a time ($76 + fees), this fee will account for 14% of the total cost, which again will disproportionately affect those on lower incomes purchasing smaller amounts.

Those admin charges have for MR1 and MR1B have more than doubled online.

Taxi and rental vehicle rego gone up by like $40.

Private Rego going up a couple of bucks, tried renewing mine but still got 3 months left, so online says can't buy more.

MikeB4

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#3127648 14-Sep-2023 11:48

Dingbatt:
Just out of interest, do IRD charge a fee to collect your tax (I’m a PAYE worker). Or are the administration costs paid from the consolidated fund? Road User Charges are effectively a ring-fenced tax (which I assume you pay GST on).

IRD charges a collection fee, it's called Tax 😁😇

Here is a crazy notion, lets give peace a chance.

HarmLessSolutions

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#3127704 14-Sep-2023 12:27

MikeB4: Energy cost rising significantly is going to be a fact of life, the "free"ride is over. My son and daughter-in-law have just left London after nearly a decade to return to the right side of the globe. One of the reason is the insane cost of energy along with a lot of other post brexit madness.

We just paid for our granddaughter to fly here for a holiday with cost an arm and leg.

As for charging, 90% + of our charging of the car is done overnight at home. Because of regen and letting the car manage power we seldom need to plug in at a public charger.

I recently crunched the numbers for my sister in London who was in the market for a car. Her flat has no offstreet parking so chargng at home would not be possible so I based my calc's on comparing an e-208 Peupeot vs. an ICE one. Petrol prices in the UK saw a per mile petrol cost of 11p/mile. Using Gridserve's fast charging rate of 69p/kWh the charging costs for an e-208 were 17p/mile. By imposing on an associate to use their private EV charger (based on the UK's current capped rate of 30p/kWh) the numbers sort of worked in favour of the e-208 but it wouldn't take many public charging events to tip the balance. In any case a few too many anti-EV recommendations by my sisters acquantences in the UK saw her opt for an ICE Mini which was more within her comfort zone, and she intends to revisit the idea of an EV when she replaces that.

The UK is scheduling a rollout of road tax from April 2025 which will be an annual lump sum so not as easy to opportion to a per mile cost.

By comparison our Polestar2 costs from 2c/km in electricity (based on lost solar FIT of 11c/kWh) to ~16c/km if Chargenet's DC charging rate is applied. Add 7c/km RUC to the public charging scenario and it level pegs with the 23c/km cost of fueling an equivalent ICE car. Obviously there is a significant maintenance saving for EV ownership and the changes likely in the RUC levying methodology will require a total recalculation of our NZ numbers but we will still be in a far more EV friendly economic environment than in the UK, and for those with the ability to use low offpeak home charging, or even better solar, RUCs are not going to challenge the economics of EV ownership.

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Dingbatt

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#3127706 14-Sep-2023 12:30

MikeB4:
Dingbatt:

Just out of interest, do IRD charge a fee to collect your tax (I’m a PAYE worker). Or are the administration costs paid from the consolidated fund? Road User Charges are effectively a ring-fenced tax (which I assume you pay GST on).

IRD charges a collection fee, it's called Tax 😁😇

Exactly my point. Collection of tax shouldn’t incur a fee. If they want a system where any amount of RUC can be purchased (which I assume will attract GST - essentially a tax on a tax) then there shouldn’t be a set fee.

“We’ve arranged a society based on science and technology, in which nobody understands anything about science technology. Carl Sagan 1996

HarmLessSolutions

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#3127709 14-Sep-2023 12:37

Dingbatt:

MikeB4:

IRD charges a collection fee, it's called Tax 😁😇

Exactly my point. Collection of tax shouldn’t incur a fee. If they want a system where any amount of RUC can be purchased (which I assume will attract GST - essentially a tax on a tax) then there shouldn’t be a set fee.

The 'set fee' is essentially a standing charge to cover the cost of the individual transaction. To forgo charging for the admin and processing of smaller purchases of RUC the alternative would be an overall price increase of the RUCs to pay for these overheads. This approach would be in conflict with the user pays ideology.

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Dingbatt

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#3127711 14-Sep-2023 12:44

Yes, I agree, but it would solve the burden placed on people that can only afford small increments of RUCs if it were built into the cost.

I’ll certainly be buying in bulk to minimise the admin cost per km.

I guess there’s always “Driving For Families”.😉

“We’ve arranged a society based on science and technology, in which nobody understands anything about science technology. Carl Sagan 1996

MikeB4

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#3127713 14-Sep-2023 12:53

RUCs like other government levies, surcharges, excise duties attract GST because those taxes aren't taxes because they said so in their naming even though levies by definition are taxes. So by calling it road user charges, and or levies they can double dip our wallets with GST and double double dip if they increase the charge or Levey .

Make it honest, make it fair and call it what it is a tax and add it to general taxation.

Here is a crazy notion, lets give peace a chance.