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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5802 posts

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#3149986 19-Oct-2023 08:04

I'm kind of hoping that they choose to quietly kick that can down the road*.

They'll make a big noise about ending the 'Ute Tax', and hopefully that'll be enough to keep their farmer friends happy.

Work needs to be done around RUC for PHEVs and Hybrids, and it does make sense to roll it all into one project and roll out in 2025.

* I'm hoping, as I've just ordered an EV ;). This of course means, RUCs will come into force for EVs on 1 April 2024 :)

MikeAqua

7769 posts

Uber Geek

#3150041 19-Oct-2023 09:48

Scott3:

It's not insurmountable. Requiring a declaration of the current Odometer value from every EV owner on the 1st of April 2023 is the likely option.

I'm not familiar with the used import diesel process, but I note the systems behind it are likely sized for the load to be spread over the year. By April 2024, I project we have over 100,000 plug in car's in NZ. Unlikely our systems have capacity to deal with this at one time. Also in most cases the government will have access to the odometer reading for the entry certification to reconcile

Of course, this could be worked through (i.e. an amnesty on displaying the label for the first month, to give time for the printing & mailing operation to catch up, or perhaps a switch to a full digital system with abundant capacity).

And of course if we run under the current legislation, PHEV's will be eligible for petrol refunds. Could potentially be an extra 30,000 refund claims the petrol refund system (which uses paper forms) will need to be sized for.

I think a one-month amnesty as you suggest is a good idea.

Perhaps from 1 May any EV without a RUC ticket gets fined and the owner has to pay for all kms on the odometer clock.

Mike

PolicyGuy

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#3150114 19-Oct-2023 13:39

MikeAqua:

I think a one-month amnesty as you suggest is a good idea.

Perhaps from 1 May any EV without a RUC ticket gets fined and the owner has to pay for all kms on the odometer clock.

How is Waka Kotahi going to properly inform all EV & PHEV owners of their new obligations? Do they have a campaign ready to go? Have they booked the MSM advertising timeslots, the billboards, and the social media opportunities? Do they have a budget for this, it'll be quite expensive? (My guess is that they have no plan and no budget)

Are WK's IT & administrative systems set up and staffed to handle:

Sending out an extra 100,000 RUC notices in the February / March period?
An extra 500 to 1,000 pieces of "Gone No Address"-type returned mail each week from mid-February to mid-April (based on 90% to 95% accuracy of their vehicle registration address data)?
An incoming extra 100,000 RUC applications in March, probably biased towards the second half of the month as EV & PHEV owners leave their RUC application & payment to the last moment?
The additional volume of routine RUC renewals from May or June onwards?
The petrol tax rebate requests from several thousand PHEV owners from the end of April onwards?

(I expect the answer to all these is "no")

Who is going to do all the enforcement for "any EV without a RUC ticket gets fined and the owner has to pay for all kms on the odometer clock"?
The Police are already under the gun for failing to deliver on their promised numbers of road safety 'outputs' such as roadside breathalyzer tests, I can't see them magically finding a whole bunch of extra Police Officer hours to check whether vehicles are BEVs or PHEVs and whether they have got RUCs.
Are Parking Wardens even empowered to issue "No RUC certificate displayed" Infringement Notices?
(My guess is that nobody has thought about this yet)

Remember, two of the parties that will form the new Government were elected on a platform of cutting public servant numbers, so they're unlikely to be too pleased when WK says it needs another big old pile of warm bodies for a RUC system extended to BEVs & PHEVs, not to mention some office space to house them and IT facilities for them to use.

As I said in my previous post, the departmental Briefing to the incoming Minister of Transport will be interesting.

SaltyNZ

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#3150127 19-Oct-2023 14:23

PolicyGuy:

Are WK's IT & administrative systems set up and staffed to handle:

Eh, it'll be fine. The NAct government aren't planning to fire any public servants and cut the services the departments provide just to give tax cuts to landlords.

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These comments are my own and do not represent the opinions of 2degrees.

jarledb

Webhead
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#3150193 19-Oct-2023 15:42

SaltyNZ:

PolicyGuy:

Are WK's IT & administrative systems set up and staffed to handle:

Eh, it'll be fine. The NAct government aren't planning to fire any public servants and cut the services the departments provide just to give tax cuts to landlords.

Oh the sarcasm is dripping..

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HarmLessSolutions

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#3150217 19-Oct-2023 17:07

PolicyGuy:

The petrol tax rebate requests from several thousand PHEV owners from the end of April onwards?

Add to that the protections in place to ensure that petrol that PHEVs are claiming on didn't actually end up in the boat, the mower, their other ICE vehicles, etc.

Plenty of odometer fraud so a bit of petrol 'transferral' would be a certainty.

https://www.harmlesssolutions.co.nz/

idleidolidyll

8 posts

Wannabe Geek

#3158769 13-Nov-2023 07:58

We have been trying to 'go green' for a while now. Riding eBikes and eScooters for short trips and sight seeing.

We replaced our diesel ute with a petrol Kei truck (CVT transmission, selectable 4WD). The use of this was to carry either: 1x motorcycle, 2x Mountain bikes, 2x eScooters, Sundry items for general home maintenance (rubbish to the tip etc). This 850kg truck has quite variable fuel economy; mainly due to windage and weight. fuel economy can be as good as 4l/100km and as bad as 7.5l/100km depending on load and driving style.

We replaced out diesel Jeep with a BMW i3 REX EV. For running around town; this is awesome and, because it has the onboard generator, we have no range anxiety. Around town we get 200-220km per charge and generally charge at off peak times using a home caravan plug (16amp). It costs about $4-5 for a full charge from empty.

When the i3 gets down to about 8% of battery power, the REX generator auto starts and charges the battery using 91 grade petrol. We've found this gets us around 5-6l/100km on the open road at about 100kph. We'd probably use the generator less then once a month.

So far, we love these and it's great for the upcoming retirement and reduced income. However, RUC on the EV seem a crazy govt policy given NZ needs to meet climate change mitigation promises or our trading partners will punish us with sanctions. Instead of costing us $5 for 200km, it will cost $20 at the new July 2023 rate! That's more than the running cost of a non plug in petrol hybrid car. It makes buying a 'real' EV uneconomical.

Suffice it to say, we are very annoyed at this short sighted policy that adds more heavily polluting diesel utes to the road and removes climate friendly EV's!

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SaltyNZ

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#3158775 13-Nov-2023 08:23

idleidolidyll:

Suffice it to say, we are very annoyed at this short sighted policy that adds more heavily polluting diesel utes to the road and removes climate friendly EV's!

Yes, they need to crank the pollution tax part of the fuel costs up a lot. But they won't, of course.

iPad Pro 11" + iPhone 15 Pro Max + 2degrees 4tw!

These comments are my own and do not represent the opinions of 2degrees.

boosacnoodle

961 posts

Ultimate Geek

#3158862 13-Nov-2023 09:26

Moreover, RUC doesn't even come close to covering many externalities of driving private vehicles. It covers roading maintenance, and poorly at that.

maoriboy

998 posts

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#3158864 13-Nov-2023 09:47

idleidolidyll:

We have been trying to 'go green' for a while now. Riding eBikes and eScooters for short trips and sight seeing.

We replaced our diesel ute with a petrol Kei truck (CVT transmission, selectable 4WD). The use of this was to carry either: 1x motorcycle, 2x Mountain bikes, 2x eScooters, Sundry items for general home maintenance (rubbish to the tip etc). This 850kg truck has quite variable fuel economy; mainly due to windage and weight. fuel economy can be as good as 4l/100km and as bad as 7.5l/100km depending on load and driving style.

We replaced out diesel Jeep with a BMW i3 REX EV. For running around town; this is awesome and, because it has the onboard generator, we have no range anxiety. Around town we get 200-220km per charge and generally charge at off peak times using a home caravan plug (16amp). It costs about $4-5 for a full charge from empty.

When the i3 gets down to about 8% of battery power, the REX generator auto starts and charges the battery using 91 grade petrol. We've found this gets us around 5-6l/100km on the open road at about 100kph. We'd probably use the generator less then once a month.

So far, we love these and it's great for the upcoming retirement and reduced income. However, RUC on the EV seem a crazy govt policy given NZ needs to meet climate change mitigation promises or our trading partners will punish us with sanctions. Instead of costing us $5 for 200km, it will cost $20 at the new July 2023 rate! That's more than the running cost of a non plug in petrol hybrid car. It makes buying a 'real' EV uneconomical.

Suffice it to say, we are very annoyed at this short sighted policy that adds more heavily polluting diesel utes to the road and removes climate friendly EV's!

What would you suggest is a suitable replacement, given that road user charges are there to help fund our roading network? Where does the money come from if ruc's no longer exist and we are looking at a way to charge people fairly?

BlargHonk

144 posts

Master Geek

#3158865 13-Nov-2023 09:47

idleidolidyll:

We have been trying to 'go green' for a while now. Riding eBikes and eScooters for short trips and sight seeing.

We replaced our diesel ute with a petrol Kei truck (CVT transmission, selectable 4WD). The use of this was to carry either: 1x motorcycle, 2x Mountain bikes, 2x eScooters, Sundry items for general home maintenance (rubbish to the tip etc). This 850kg truck has quite variable fuel economy; mainly due to windage and weight. fuel economy can be as good as 4l/100km and as bad as 7.5l/100km depending on load and driving style.

We replaced out diesel Jeep with a BMW i3 REX EV. For running around town; this is awesome and, because it has the onboard generator, we have no range anxiety. Around town we get 200-220km per charge and generally charge at off peak times using a home caravan plug (16amp). It costs about $4-5 for a full charge from empty.

When the i3 gets down to about 8% of battery power, the REX generator auto starts and charges the battery using 91 grade petrol. We've found this gets us around 5-6l/100km on the open road at about 100kph. We'd probably use the generator less then once a month.

So far, we love these and it's great for the upcoming retirement and reduced income. However, RUC on the EV seem a crazy govt policy given NZ needs to meet climate change mitigation promises or our trading partners will punish us with sanctions. Instead of costing us $5 for 200km, it will cost $20 at the new July 2023 rate! That's more than the running cost of a non plug in petrol hybrid car. It makes buying a 'real' EV uneconomical.

Suffice it to say, we are very annoyed at this short sighted policy that adds more heavily polluting diesel utes to the road and removes climate friendly EV's!

I have a spreadsheet that looks at the costs of replacing our old ICE that gets between 8-10L/100km with a second hand hybrid or an EV (old Ioniq?). The Ioniq obviously has the higher capital cost (+$10k-ish) vs the hybrid but the running cost savings over say 5 years made up for it. But now with RUCs coming in for EVs, it is a no brainer to go with a Hybrid getting 5L/100km.

HarmLessSolutions

956 posts

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#3158868 13-Nov-2023 09:55

BlargHonk:

I have a spreadsheet that looks at the costs of replacing our old ICE that gets between 8-10L/100km with a second hand hybrid or an EV (old Ioniq?). The Ioniq obviously has the higher capital cost (+$10k-ish) vs the hybrid but the running cost savings over say 5 years made up for it. But now with RUCs coming in for EVs, it is a no brainer to go with a Hybrid getting 5L/100km.

The details of what the revised RUC system will look like are far from certain and are very well stated in the OP of this thread. The situation that will be put in place for hybrids and PHEVs is yet to be laid out but during election campaigning National strongly hinted at a distance based RUC regime for all road vehicles with that distance monitored by electronic means.

If Luxon can get his cats herded we may get a little closer to learning where this taxation system is headed.

https://www.harmlesssolutions.co.nz/

idleidolidyll

8 posts

Wannabe Geek

#3158888 13-Nov-2023 10:45

In terms of 'fairness', we should be charging the vehicles which damage the road system the most, significantly higher rates than they are paying now (commensurate with rates charged for light vehicles).

Light vehicles are effectively subsidising trucks massively. That change could achieve two useful outcomes.

Fairness. Those that damage the roads most are charged fairly for that damage and the extra high strength of new construction needed for 40 tonne plus trucks is reduced massively because transport would migrate toward rail.
Migration to rail. Actual costs due to roading repairs and extra high performance construction, to handle high loads, become chargeable in the end purchase of the transported items. 'Market forces' therefore drive freight to the best method: rail for long distance rather than trucks clogging up and damaging roads.

Why ARE we subsiding road transport (by hiding costs) over rail when the opposite (for long distance) is a far better alternative?

SaltyNZ

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#3158940 13-Nov-2023 10:53

HarmLessSolutions:

If Luxon can get his cats herded we may get a little closer to learning where this taxation system is headed.

I think we already know that pandering to the anti-woke/climate change denier crowd will be an important aspect of it.

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These comments are my own and do not represent the opinions of 2degrees.

wellygary

8261 posts

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#3158944 13-Nov-2023 11:05

HarmLessSolutions:

The details of what the revised RUC system will look like are far from certain and are very well stated in the OP of this thread. The situation that will be put in place for hybrids and PHEVs is yet to be laid out but during election campaigning National strongly hinted at a distance based RUC regime for all road vehicles with that distance monitored by electronic means.

If Luxon can get his cats herded we may get a little closer to learning where this taxation system is headed.

The only details up for grabs is the PHEV rate, and TBH I think they will just pro rata a PHEV rate @70% or 80% and tell PHEV owners to wear it, (or use less petrol)

As it currently stands EV have an exemption from RUC until 1 April 2024, if nothing is done it will expire and EVs will be in the same category as a diesel Car,.. Nothing has to be done for this to happen,

The major shakeup of RUCs with a possible transition from Petrol Taxes is a secondary policy and is not directly connected to this this is not likely to happen without significant policy needing to be done ( i.e its years away )

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