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

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#3163376 24-Nov-2023 21:09

I hope media will refuse to allow the admin fee to be listed separately as we can't avoid it or perhaps refer to the admin fee as a percentage.

Assuming 76 12 split 15% admin fee seem excessive opps forgot to add gst $17 admin fee

snj

169 posts

Master Geek

#3163381 24-Nov-2023 21:46

HarmLessSolutions:

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.

Already well established, probably however means private corporations will get rich selling the existing solutions. E Road have an example of one on https://www.eroadglobal.com/global/capabilities-and-expertise/road-user-charging/ & Waka Kotahi list 4 providers of eRUC systems at https://www.nzta.govt.nz/vehicles/road-user-charges/ruc-distance-recorders/

Pretty sure they don't have to mimic the display of a normal RUC label either, remember seeing a WK contractor vehicle with one that was just a big X-segment display years ago.

ezbee

2373 posts

Uber Geek

#3163384 24-Nov-2023 22:32

I can't see electronic RUC working for everyday vehicles as these are not cheap devices.
To build a device that can be SERIOUSLY anti-tamper, Government approvals, and survive the heat and environmental conditions.
Its not something you pick up off aliexpress?

EROAD device I expect sets you back quite a bit. If you are only buying one.
Then $ per Km sunk cost if you are not doing high Km like a trucke with a valuable load each time.
It pays for a courier or trucking company, but for your shopping cart of a Leaf?

Hopefully its not something people want to steal like in car navs of old.

Scott3

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#3163392 24-Nov-2023 23:20

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 Imagine you have looked into it, but when I had an i3 REX, the recommended octane was definitely higher than 91.

We really need to see what the policy is before we criticize too much. But if it was rolled out without any changes, we would see EV's becoming more expensive to run than efficient petrol cars (yaris hybrid etc).

Scott3

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#3163395 24-Nov-2023 23:39

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.

The first quote, makes it clear that the intent that there will be a period of time where Electric vehicle's Pay RUC's, before RUC's are rolled out to the petrol car fleet.

Big question is what is the EV RUC rate going to be. Same as diesel cars, or the same as what a yaris hybrid pays in petrol tax (about 1/3rd of what the diesel car pays). The situation is inherently unfair, and either option that is chosen, people will be unhappy.

On electronic road user charging. This could include gps based e-road style system. But also could include moving the current paper label system online. (i.e. the same system we have now, but without labels, saving all the printing and posting cost. Police would need to check the database to ensure people are up to date with RUC's, rather than check physical labels).

If the electronic system is more than a basic tweak of the current system, it is unrealistic to roll it out by April. Meaning the EV RUC exemption will need to be extended again. (unless of course the government wants to bring 100,000 EV's into the label based RUC system, to then transition them to the electronic system a few months later.)

On time of use road charging, this could be done by number plate reading camera's (as per our current toll roads), so may not be the same system - in fact, unless they are going to roll the electronic system out to all cars in Auckland, it will need to be a different system.

Dingbatt

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#3163402 25-Nov-2023 05:53

ezbee:

I can't see electronic RUC working for everyday vehicles as these are not cheap devices.
To build a device that can be SERIOUSLY anti-tamper, Government approvals, and survive the heat and environmental conditions.
Its not something you pick up off aliexpress?

EROAD device I expect sets you back quite a bit. If you are only buying one.
Then $ per Km sunk cost if you are not doing high Km like a trucke with a valuable load each time.
It pays for a courier or trucking company, but for your shopping cart of a Leaf?

Hopefully its not something people want to steal like in car navs of old.

I would assume that any EV (or other vehicle for that matter) that has manufacturer connectivity for maintenance and software updates, would have the ability to tell the manufacturer the car’s odometer reading. I’m sure most probably already do.

It would be relatively straight forward for the government agency to require that data be supplied so it could be matched against RUC status. In fact I would see a revenue opportunity for those manufacturers to provide a service to monitor and pay RUCs (for a fee of course) on the owner’s behalf. It’s only software after all.

It might have the added bonus of forcing some manufacturers (looking at you VWAG) to get off their elbows and provide connectivity. If buyers have a simple solution rather than have to buy an expensive piece of kit to make their car compliant, it may sway a purchase decision.

I did wonder if the connectivity provided by Apple CarPlay and Android Auto would allow a similar thing to be achieved. How hard would it be to have an app that could be used to read the odometer and pay RUCs? It could probably be hacked, but then most systems are able to be tampered with if the malicious intent is great enough.

The Tesla app has all the required info. How good would it be to just click “buy me some kms” in that?

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SaltyNZ

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2degrees

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#3163411 25-Nov-2023 07:33

Scott3:

The first quote, makes it clear that the intent that there will be a period of time where Electric vehicle's Pay RUC's, before RUC's are rolled out to the petrol car fleet.

Big question is what is the EV RUC rate going to be. Same as diesel cars, or the same as what a yaris hybrid pays in petrol tax (about 1/3rd of what the diesel car pays). The situation is inherently unfair, and either option that is chosen, people will be unhappy.

It's no secret I am against the new government's stated policies of restarting oil & gas drilling and rebuilding the Marsden Point refinery (that never refined NZ oil for fuel anyway) at massive taxpayer expense, nor is Simeon Brown any EV driver's friend but let's give them the benefit of the doubt until they make the decision. After all, the PM owns two Teslas.

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scuwp

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#3163413 25-Nov-2023 08:37

Scott3:

Big question is what is the EV RUC rate going to be. Same as diesel cars, or the same as what a yaris hybrid pays in petrol tax (about 1/3rd of what the diesel car pays). The situation is inherently unfair, and either option that is chosen, people will be unhappy.

There will never be a system that is fair to everyone. You are right, someone will always be unhappy. I see no reason why EV's shouldn't just go onto the current RUC rates. They use the same roads as diesels do and at similar weights the same wear and tear. It's only fair they pay the same as light diesel vehicles.

Yes, once implemented the EV's may be a bit more expensive to operate on a per KM basis than a very light hybrid or even economical petrol as far as tax is concerned, but those vehicles still need to buy petrol which is dearer than electricity on a per Km basis (I would guess). Each person is just going to have to weigh up their individual use case.

Getting all vehicles into the RUC system will be a longer term project. The RUC system runs through the old Wanganui computer system built in the 1970's, so that's the first challenge. The government have already announced reforms to do away with the labels as compulsory, as soon as they have supporting electronic software systems in place for the public and for enforcement.

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

PolicyGuy

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#3163415 25-Nov-2023 08:52

SaltyNZ:

Scott3:

The first quote, makes it clear that the intent that there will be a period of time where Electric vehicle's Pay RUC's, before RUC's are rolled out to the petrol car fleet.

Big question is what is the EV RUC rate going to be. Same as diesel cars, or the same as what a yaris hybrid pays in petrol tax (about 1/3rd of what the diesel car pays). The situation is inherently unfair, and either option that is chosen, people will be unhappy.

It's no secret I am against the new government's stated policies of restarting oil & gas drilling and rebuilding the Marsden Point refinery (that never refined NZ oil for fuel anyway) at massive taxpayer expense, nor is Simeon Brown any EV driver's friend but let's give them the benefit of the doubt until they make the decision. After all, the PM owns two Teslas.

The existing legislation exemption will expire, and EVs will be charged the same rate as light diesel cars are charged now, using the same paper-based system. For anything else to happen, there would have to be legislation passed in Parliament, and the government has got a huge pile of things it considers really important to get through the House, so I doubt that a reform of the RUC system would get a look in. It would be a complex bit of legislation, and would also need probably a year of implementation time, too - all the existing vehicles & systems would need to be changed over.
The only possibility for a legislation change would be one to push out the exemption by a year, to allow a new RUC system to come in, but since that would require the new Minister of Transport to go back on an election pledge, it seems unlikely IMO

As a "bonus", I expect that the adding of 100,000 BEV & PHEV vehicles to the RUC system in April will be an administrative and logistical nightmare. As I posted before, I'm confident that WK won't have made substantial plans for this, and won't have budget available for the actual implementation surge, or for the media campaign needed to support it.

ANglEAUT

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#3163419 25-Nov-2023 09:49

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.

...

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.

Coincidence? I doubt it ...

Please keep this GZ community vibrant by contributing in a constructive & respectful manner.

smac

333 posts

Ultimate Geek

#3163431 25-Nov-2023 10:16

Scott3:

On electronic road user charging. This could include gps based e-road style system. But also could include moving the current paper label system online. (i.e. the same system we have now, but without labels, saving all the printing and posting cost. Police would need to check the database to ensure people are up to date with RUC's, rather than check physical labels).

They already can, they've had that access for decades.

scuwp:

Getting all vehicles into the RUC system will be a longer term project. The RUC system runs through the old Wanganui computer system built in the 1970's, so that's the first challenge.

ummm...no, no it doesn't. You're quite a few years out of touch there.....

Scott3

3946 posts

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#3163449 25-Nov-2023 11:30

Dingbatt:

ezbee:

I can't see electronic RUC working for everyday vehicles as these are not cheap devices.
To build a device that can be SERIOUSLY anti-tamper, Government approvals, and survive the heat and environmental conditions.
Its not something you pick up off aliexpress?

EROAD device I expect sets you back quite a bit. If you are only buying one.
Then $ per Km sunk cost if you are not doing high Km like a trucke with a valuable load each time.
It pays for a courier or trucking company, but for your shopping cart of a Leaf?

Hopefully its not something people want to steal like in car navs of old.

I would assume that any EV (or other vehicle for that matter) that has manufacturer connectivity for maintenance and software updates, would have the ability to tell the manufacturer the car’s odometer reading. I’m sure most probably already do.

It would be relatively straight forward for the government agency to require that data be supplied so it could be matched against RUC status. In fact I would see a revenue opportunity for those manufacturers to provide a service to monitor and pay RUCs (for a fee of course) on the owner’s behalf. It’s only software after all.

It might have the added bonus of forcing some manufacturers (looking at you VWAG) to get off their elbows and provide connectivity. If buyers have a simple solution rather than have to buy an expensive piece of kit to make their car compliant, it may sway a purchase decision.

I did wonder if the connectivity provided by Apple CarPlay and Android Auto would allow a similar thing to be achieved. How hard would it be to have an app that could be used to read the odometer and pay RUCs? It could probably be hacked, but then most systems are able to be tampered with if the malicious intent is great enough.

The Tesla app has all the required info. How good would it be to just click “buy me some kms” in that?

While technically possible, I don't think that mandating integrated software that sends odometer readings to the government is partially viable.

We are a small market. a decent number of brands are likely to not be willing to create custom software for our market.
Many car's don't have connectivity. Tied in with the above, many cars which feature connectivity in other markets do not bother to roll it out in NZ.
A material chunk of our fleet is used imports with software packages intended for other countries.
Connectivity often ages poorly, either for cost or technology changes. Using your Tesla example, free standard connectivity expires when the car is 8 years old. And I assume you have to pay to have it after that. For people who don't otherwise value connectivity forcing them to pay for it for RUC data collection purposes would add a dead weight cost (and give brands the opportunity to screw consumers on pricing). On technology, this typically becomes obsolete before end of life of a car. As an example, spark is closing their 3G network towards the end of 2025.
Given the april date (if this is not to be extended), all this stuff need to happen in a hurry.

At minimum we would need to make car connectivity for RUC optional, and provide another options for people who don't want to, or can't go this route.

Scott3

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#3163453 25-Nov-2023 12:00

SaltyNZ:

It's no secret I am against the new government's stated policies of restarting oil & gas drilling and rebuilding the Marsden Point refinery (that never refined NZ oil for fuel anyway) at massive taxpayer expense, nor is Simeon Brown any EV driver's friend but let's give them the benefit of the doubt until they make the decision. After all, the PM owns two Teslas.

Getting a bit off topic, but restarting the refinery was only NZ first policy, and didn't make it into the coalition agreement.

As for Simeon Brown, the ultimate policy he is promoting is RUC's on all vehicles. A lot of EV drivers support this, as the fairest outcome to collect road tax (most EV owners recognize that the land transport network needs to be paid for somehow).

The only concern I have is what happens in the transition. "starting with EV's", could mean a 6 month gap, of a 6 year gap, which are a world apart. If it is to be a 6 month gap, what happens in the transition is trivial. But if the gap is to be years, it is super important.

My concern as an EV driver is if the current diesel RUC rates are rolled out to EV's, EV's will pay tipple the road tax of a Yaris hybrid. Personally won't have a material impact on me (we do low mileages in our car's, and have the money), but I am concerned it will create a perverse incentive for the likes of long distance commuters to ditch their leaf's, and swap to Yaris / Aqua hybrids. I would much rather see policy favor locally generated electricity be promoted over imported petrol for transport.

PolicyGuy:

The existing legislation exemption will expire, and EVs will be charged the same rate as light diesel cars are charged now, using the same paper-based system. For anything else to happen, there would have to be legislation passed in Parliament, and the government has got a huge pile of things it considers really important to get through the House, so I doubt that a reform of the RUC system would get a look in. It would be a complex bit of legislation, and would also need probably a year of implementation time, too - all the existing vehicles & systems would need to be changed over.
The only possibility for a legislation change would be one to push out the exemption by a year, to allow a new RUC system to come in, but since that would require the new Minister of Transport to go back on an election pledge, it seems unlikely IMO

As a "bonus", I expect that the adding of 100,000 BEV & PHEV vehicles to the RUC system in April will be an administrative and logistical nightmare. As I posted before, I'm confident that WK won't have made substantial plans for this, and won't have budget available for the actual implementation surge, or for the media campaign needed to support it.

I'm not knowledgeable on the process, however it has happened twice (I think) before. Last time the Amendment Order process was used, and seemed fairly straightforward.

https://legislation.govt.nz/regulation/public/2021/0304/latest/whole.html#LMS552717

As current legislation stands, it creates a pretty much impossible task for Waka Kotahi to roll this out, so some legislative change will be needed anyway. WK simply won't have the capacity to print and main 100,000 labels for an overnight change over. If the electronic system is only 6 - 12 months away, deferring for it to be ready would seem a reasonable action.

Scott3

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#3163504 25-Nov-2023 12:19

scuwp:

Scott3:

Big question is what is the EV RUC rate going to be. Same as diesel cars, or the same as what a yaris hybrid pays in petrol tax (about 1/3rd of what the diesel car pays). The situation is inherently unfair, and either option that is chosen, people will be unhappy.

There will never be a system that is fair to everyone. You are right, someone will always be unhappy. I see no reason why EV's shouldn't just go onto the current RUC rates. They use the same roads as diesels do and at similar weights the same wear and tear. It's only fair they pay the same as light diesel vehicles.

Yes, once implemented the EV's may be a bit more expensive to operate on a per KM basis than a very light hybrid or even economical petrol as far as tax is concerned, but those vehicles still need to buy petrol which is dearer than electricity on a per Km basis (I would guess). Each person is just going to have to weigh up their individual use case.

Getting all vehicles into the RUC system will be a longer term project. The RUC system runs through the old Wanganui computer system built in the 1970's, so that's the first challenge. The government have already announced reforms to do away with the labels as compulsory, as soon as they have supporting electronic software systems in place for the public and for enforcement.

The underlying issue here is that modern small petrol hybrids, get a crazy good deal under the current system. i.e. Yaris hybrid @ 3.6 L/100km (3P-WLTP conversion)*. This has become much more of an issue over the last few years, as (non plug in) hybrids have gone mainstream.

And efficient RUC paying car's get a bad deal in comparison.

The opposite is true if you look at inherently less efficient vehicle classes like larger van's, utes & Upper large SUV's. (You are going to pay a lot more road tax in a petrol Hiace than a diesel one).

This impact has already distorted the NZ vehicle market. Smaller, more efficient vehicles are mostly petrol, while larger less efficient vehicles like utes, upper large SUV's, and larger van are majority diesel. With hindsight we got extremely lucky with this. When europe did its big push to diesel power, our road tax policy meant small diesels (swift diesel, polo bluemotion etc) didn't sell here - and we subsequently missed all the diesel related air quality issues that major centers in Europe had. But I should note this was by luck, not by design.

But i would hate to see EV's suffer the same fate as the Swift diesel, and polo bluemotion diesel here, where our tax policy makes them uneconomic.

However if we set EV ruc's at the 1/3rd of the level of Diesel RUC's, this is inherently unfair to diesel car owners. As you say, they do roughly equivalent road damage, and occupy roughly the same road space.

And if we trippled petrol tax, so the yaris hybrid owner pays the same road tax as a polo bluemotion diesel, this would have a massive impact on the family with a petrol people mover (at say 11L/100km), who would now be paying triple the road tax of deisel car drivers.

No possible way to make this fair.... (without going to RUC's on all vehicles).

jarledb

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#3163708 25-Nov-2023 17:19

I don't think the RUC system should be fair. I think an environmentally conscious government would implement a RUC system that gives a higher price per km for more polluting cars, and less for environmentally friendly cars.

With the current government that is highly unlikely to happen.

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