New Road User Tax Introduced for Electric Vehicles in New Zealand

The increasing number of electric and plug-in hybrid vehicles on New Zealand roads has resulted in a decrease in funds for infrastructure projects from the country’s petrol tax. However, starting from March 31, 2024, electric car and plug-in hybrid vehicle owners weighing less than 3500kg will need to pay a new road-user tax based on the distance they travel. This tax aims to recover the lost revenue from the petrol excise.

It is anticipated that electric cars will be subject to the same road-user charge that currently applies to diesel vehicles in New Zealand, which is set at a rate of $NZ0.076 per kilometer. In July 2023, electric passenger cars accounted for 14% of new vehicle sales in the country due to the sliding-scale rebate system. Under this system, high-polluting vehicles are charged higher sales taxes, while rebates are provided to buyers of plug-in hybrids and electric cars.

The increased popularity of electrified vehicles has resulted in a decrease in revenue for the National Land Transport Fund, which funds road upgrades and maintenance. The road-user charge will come into effect regardless of the outcome of the upcoming general election in New Zealand.

Traditional and mild-hybrid vehicles, along with electrified vehicles weighing over 3500kg, will be exempt from the road-user tax until 2026. However, government officials have acknowledged that all vehicles will eventually be required to pay the distance-based charge.

Additionally, the New Zealand government plans to raise the petrol excise by 12 NZ cents over the next three years, leading to a $NZ5 billion boost to the transport fund. This represents a 25% increase.

In Australia, the state of Victoria’s road-user charge for electric and plug-in hybrid vehicles is facing opposition from the Federal Government, despite receiving support from local states and territories, some of which have introduced their own distance-based tax measures.

– New Zealand Government

– Victorian Government
– Federal Government

Note: The original article was written by Ben Zachariah and can be found [here](the original article URL).