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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8 posts

Wannabe Geek

#3158948 13-Nov-2023 11:16

HarmLessSolutions:

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.

Yep, a vehicle that runs on petrol only (non plug in hybrid) is, without other changes, about to become the smart purchase over and above the vehicle types we need to mitigate climate change and meet our international promises and responsibilities (and the current cost savings king). Who hates electric vehicles? It seems that NAct does!

The big fuel companies must be laughing out loud about now and counting those donations as a massive earner!

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HarmLessSolutions

955 posts

Ultimate Geek

Subscriber

#3158953 13-Nov-2023 11:21

idleidolidyll:

HarmLessSolutions:

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.

Yep, a vehicle that runs on petrol only (non plug in hybrid) is, without other changes, about to become the smart purchase over and above the vehicle types we need to mitigate climate change and meet our international promises and responsibilities (and the current cost savings king). Who hates electric vehicles? It seems that NAct does!

The big fuel companies must be laughing out loud about now and counting those donations as a massive earner!

Umm, you screwed up on editing the quote. That wasn't what I posted but part of what I quoted from another post.

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

scuwp

3874 posts

Uber Geek

#3159050 13-Nov-2023 12:38

boosacnoodle:

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

From Waka Kotahi website:

The revenue collected from road user charges is dedicated to the National Land Transport Fund (NLTF). The NLTF funds new roads, improvements and maintenance, public transport, road safety, and walking and cycling.

Road safety includes enforcement (Police). So RUC fee's covers quite a lot things and contributes to the same fund that FED does, and for the benefit of all road users.

Lazy is such an ugly word, I prefer to call it selective participation

smac

333 posts

Ultimate Geek

#3160565 17-Nov-2023 14:38

idleidolidyll:

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.

I've also done the math on my commute.....and yes, sub $6 becomes just over $20 (calculating the RUC transaction fee across buying 5k at a time). Ouch.

Maybe that approaches the fuel cost of a hybrid across 200km, maybe not (dunno, don't want one, don't see the point), but definitely not once you factor in the increase in servicing. It's even more clear for me.....my alternative to my Leaf is my Falcon, which is $50+ for those 200km 😁

So yeah if/when RUC goes on, that's a bummer, another $15 a week for me, but my existing cheapy EV is still the cheapest commute out there for me. Cheaper than any other car, in fact cheaper than any other viable option, including the bus that would more than double my commute time.

MikeAqua

7769 posts

Uber Geek

#3160570 17-Nov-2023 14:42

smac:

idleidolidyll:

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.

I've also done the math on my commute.....and yes, sub $6 becomes just over $20 (calculating the RUC transaction fee across buying 5k at a time). Ouch.

Maybe that approaches the fuel cost of a hybrid across 200km, maybe not (dunno, don't want one, don't see the point), but definitely not once you factor in the increase in servicing. It's even more clear for me.....my alternative to my Leaf is my Falcon, which is $50+ for those 200km 😁

So yeah if/when RUC goes on, that's a bummer, another $15 a week for me, but my existing cheapy EV is still the cheapest commute out there for me. Cheaper than any other car, in fact cheaper than any other viable option, including the bus that would more than double my commute time.

Roads have to be funded somehow and it's fair that all users contribute.

Mike

mudguard

2067 posts

Uber Geek

#3160577 17-Nov-2023 14:53

smac:

my alternative to my Leaf is my Falcon, which is $50+ for those 200km 😁

That's better than my Corolla which is $52 for 200kms (26c per km). How often are you doing a 200km commute??

SaltyNZ

8109 posts

Uber Geek

Trusted

2degrees

Lifetime subscriber

#3160586 17-Nov-2023 15:04

MikeAqua:

Roads have to be funded somehow and it's fair that all users contribute.

Yes, that's true, and nobody is suggesting EV drivers shouldn't. It's just that in the absence of any adjustments, letting the EV exemption lapse will create exactly the opposite outcome that we as a planet need - it will make fossil fuel burners cheaper again.

Now if all vehicles move to a RUC model then that perverse situation is avoided since the small petrol cars will pay the same RUC fee as well as fuel. But until we know what's actually proposed this is all meaningless speculation.

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

smac

333 posts

Ultimate Geek

#3160587 17-Nov-2023 15:05

mudguard:

That's better than my Corolla which is $52 for 200kms (26c per km). How often are you doing a 200km commute??

Oh the 200km is across 5 days, 40km round trip per day.

mattwnz

20045 posts

Uber Geek

#3160612 17-Nov-2023 15:16

idleidolidyll:

HarmLessSolutions:

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.

Yep, a vehicle that runs on petrol only (non plug in hybrid) is, without other changes, about to become the smart purchase over and above the vehicle types we need to mitigate climate change and meet our international promises and responsibilities (and the current cost savings king). Who hates electric vehicles? It seems that NAct does!

The big fuel companies must be laughing out loud about now and counting those donations as a massive earner!

Depending on how much fuel that petrol only vehicle uses, the owner potentially could be paying more then their 'fair share' of tax to use the roads via petrol levies. A hybrid owner potentially gets a better deal, because they can effectively reduce the amount they spend on petrol and tax by having a more efficient vehicle. There is a reason you can't buy a Toyota RAV 4 and could be waiting a year or more, because people want hybrids as they make a lot of sense ATM. My parents ditched the idea of an EV and the issues around them, to buy a small hybrid SUV, which effectively halved their petrol cost overnight compared to their old RAV.
Same goes though with buying a smaller car with a less powerful engine. That is why IMO RUCs are far more fair and seems to be the way we are heading, But we don't want both RUCs and petrol tax, because it is the lower income people who can't afford a new car and/or an EV, that get penalised, and the people who can most afford to pay more in tax, who will be paying less. That goes against the way council rates get charged, which base the fees charged on peoples wealth (higher house value equals higher rates) and assumed higher income with owning a higher value house. IMO that is also unfair because it should be based more on user pays, which is what RUCs are. But the vehicles that cause the most damage on the roads seem to be these heavier trucks which National greenlighted, and IMO they should be paying more in tax and RUC to fix the mess. I have noticed that the ruts and pot holes on a road are spaced at a trucks wheel width, but it is a complete failure for the roads to even get to that condition. Then then they get repaired, you can see that the repair job is already beginning to fail a few weeks later. Maybe we need to look at concrete roads.

cddt

1442 posts

Uber Geek

#3160628 17-Nov-2023 15:36

Senecio:

If anyone is disputing the impact of up front RUC in increments of 1,000km will have to low income workers, then you just have to come to a South Auckland service station. I regularly pass through Otara on my way to work and I often see people putting $30, or even $20 in their cars. $20 a day is what it costs me for my daily commute.

I filled up my car yesterday on the way home from work and it made me think of this thread.

The couple next to me put $12 of petrol in their old Corolla. Their windscreen had several cracks in it (not shattered but obviously damaged). Two young kids in the back.

If anyone thinks they're going to be stumping up with $76 + admin fee as a lump sum for 1000 km of RUC they need their head checked.

There's got to be a better solution, perhaps one where light vehicles are no longer subsidising heavy trucks....

olivernz

472 posts

Ultimate Geek

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#3160637 17-Nov-2023 16:00

cddt:

There's got to be a better solution, perhaps one where light vehicles are no longer subsidising heavy trucks....

Yeah it's called proper public transport like in Europe. THAT is the way out for those that don't have as much means. Subsidised monthly tickets which replace all of the commute and regular distances so that using the car is the exception.

In NZ currently public transport is expensive and lacks the right options to be viable.

mudguard

2067 posts

Uber Geek

#3160652 17-Nov-2023 16:36

cddt:

The couple next to me put $12 of petrol in their old Corolla. Their windscreen had several cracks in it (not shattered but obviously damaged). Two young kids in the back.

If anyone thinks they're going to be stumping up with $76 + admin fee as a lump sum for 1000 km of RUC they need their head checked.

There's got to be a better solution, perhaps one where light vehicles are no longer subsidising heavy trucks....

That's kind of the crux of the issue. And why it's taken so long to implement anything. Generally the easier it is to comply, the more likely people will do it.

However as we've seen in recent times, I can't imagine everybody embracing vehicle mounted GPS.

HarmLessSolutions

955 posts

Ultimate Geek

Subscriber

#3163267 24-Nov-2023 16:47

From p.6 of the Coalition Agreement:

Work to replace fuel excise taxes with electronic road user charging for all vehicles, starting with electric vehicles.

Immediately followed by:

Work with Auckland Council to implement time of use road charging to reduce congestion and improve travel time reliability.

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

wellygary

8212 posts

Uber Geek

#3163272 24-Nov-2023 16:55

HarmLessSolutions:

From p.6 of the Coalition Agreement:

Work to replace fuel excise taxes with electronic road user charging for all vehicles, starting with electric vehicles.

Immediately followed by:

Work with Auckland Council to implement time of use road charging to reduce congestion and improve travel time reliability.

Yeah, but this will be separate from regular RUCs on EVs

They don't need to actually have a policy to remove the exemption,

in the absence of anything else, RUCs on EVs will automatically apply from 1 April 2024

https://legislation.govt.nz/regulation/public/2021/0304/7.0/whole.html
Road User Charges (Exemption Period for Light Electric RUC Vehicles) Amendment Order 2021
"This order extends the exemption period to the close of 31 March 2024"

HarmLessSolutions

955 posts

Ultimate Geek

Subscriber

#3163330 24-Nov-2023 17:35

wellygary:

HarmLessSolutions:

From p.6 of the Coalition Agreement:

Work to replace fuel excise taxes with electronic road user charging for all vehicles, starting with electric vehicles.

Immediately followed by:

Work with Auckland Council to implement time of use road charging to reduce congestion and improve travel time reliability.

Yeah, but this will be separate from regular RUCs on EVs

They don't need to actually have a policy to remove the exemption,

in the absence of anything else, RUCs on EVs will automatically apply from 1 April 2024

https://legislation.govt.nz/regulation/public/2021/0304/7.0/whole.html
Road User Charges (Exemption Period for Light Electric RUC Vehicles) Amendment Order 2021
"This order extends the exemption period to the close of 31 March 2024"

I'm in no doubt that RUCs will be levied on EVs from April 2024 but the detail I found interesting was "electronic road user charging" and the possible implication that EVs may become a test bed for such technology.

Also interesting that the mention of congestion charging immediately followed considering that real time electronic road user charging has the ability to geolink vehicle location for this taxation purpose. Maybe just coincidence though that the two items were listed consecutively.

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

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