Global Incentives for EVs

Why incentives? Lots of reasons but the main reason world governments provide incentives are:

Environmental: Reduction in greenhouse gas emissions – reduction in air pollution and noise pollution in cities
Health: Improved air quality in cities, reduction in premature deaths & serious illness and a reduction in health costs
Economic: Reduction in oil import bills and improved balance of trade figures
Strategic: Less reliance on foreign oil from politically unstable regions of the world

EV Incentives are fluid so it’s best to check on the latest incentives locally in whatever country you reside in.  

Australia (June 2022)

Australia has been the most unenlightened developed country in the world in this regard. No wonder the manufacturers saw little merit in bringing EVs to the land down under. We have been the world’s least encouraging country for EVs despite the ‘in your face’ economic benefits of cleaner air in our cities, less spending on health, better balance of trade figures, reduction in reliance on foreign oil. But 2021 was the turning point in the attitudes of both major political parties in the most populous states of New South Wales and Victoria and by 2022 incentives were on offer in all states and territories of Australia.  

The current list of incentives in Australia as at June 2022 are (courtesy of RAC (WA)):

WA EV incentives

WA long lagged the country on direct EV incentives, but in May 2022 the State Government announced 10,000 rebates of $3,500 would be available for electric and hydrogen vehicles priced below $70,000. Premier Mark McGowan said it would “mean more people can take up the opportunity to buy an electric vehicle and reduce their carbon emissions, reduce their fuel costs and reduce their dependence on fuel”.

As with other states, WA also announced its intention to introduce a road user charge on 1 July 2027 – something that RAC does not support. Under this, drivers of electric vehicles will pay 2.5c/km for battery electric vehicles and 2c/km for plug-in hybrid EVs. It is also indexed to inflation, so by the time the charge is introduced it will almost certainly cost more.

This latest package complements WA’s broader Electric Vehicle Strategy which focused on the infrastructure required to encourage the uptake and use of EVs, including the initial commitment of $20 million for installing EV public charging stations at 45 locations. It’s claimed to be the longest fast-charging EV network in the country. The vast collection of DC chargers is planned to be operational by January 2024 and will sprawl from Kununurra to Esperance.

That’s a significant challenge in a state that accounts for the largest land mass. It also adds to Australia’s first electric highway built by RAC around seven years ago.

The 2022-23 State Budget also accounts for $22.6 million for additional charging infrastructure including grants, trialling EV charging facilities at four Perth train stations, and an additional eight EV chargers to extend the state charging network to the South Australian border.

The WA government is also increasing EV charging infrastructure at “all new public building capital works – including government office accommodation, hospitals, schools and sports facilities among other building types”.

The government also plans to commit to at least 25 per cent of its eligible vehicle fleet being electric by 2025-26.

Plus, the state will work with other state and national bodies with the view to developing “consistent standards and guidelines regarding electric vehicles and charging infrastructure”. (courtesy of RAC (WA))

EV sales target: None specified.

NSW EV incentives

Australia’s most populous state has the most generous EV incentives.

Electric vehicles up to $68,750 are eligible for a $3,000 rebate, with the government committing to 25,000 rebates. EVs priced up to $78,000 can also receive a refund on stamp duty, which can be up to $3,000. When used together, the rebates can save buyers up to $5,540.

The NSW government also plans to remove stamp duty on all EVs and plug-in hybrids and introduce a road user charge by July 2027 or when EVs account for at least 30 per cent of new sales. Other incentives include the ability to use transit (T2 and T3) lanes until at least 31 October, 2022.

The NSW government has also committed $171 million to a vast EV charging network that encompasses “EV super-highways” with ultra-rapid charging along major routes. There are also plans for EV “commuter corridors” in Sydney, ensuring an ultra-rapid charger at least every five kilometres for Sydneysiders, and off-street EV chargers for those who can’t charge at home. And the NSW government is greening its fleet, including with large commercial vehicles. All Sydney buses are planned to be zero emissions by 2030.

NSW has signed up to the COP26 zero emissions vehicle pledge (banning the sale of fossil fuelled vehicles) by 2040, independent of the Australian Government, and committed to net zero emissions for the state by 2050. (courtesy of RAC (WA))

EV sales target: At least 50 per cent by 2030-31.

Victoria EV incentives

Victoria provides a $3,000 EV rebate on vehicles under $68,740, with 20,000 rebates initially on offer and more flagged. The state also allows EVs to dodge the controversial Victorian luxury car duty, which can save $1,000 on a $100,000 car and up to $14,400 on a $300,000 car. The luxury car duty is separate from the federal luxury car tax. So, while the savings sound generous, it’s effectively removing a tax that doesn’t exist in most other parts of the country.

Victoria is also the first state to introduce an EV specific tax. It charges electric vehicle owners 2.5 cents per kilometre to partially account for the declining fuel excise paid by those filling up with petrol or diesel. For a car travelling 15,000km annually, that means $375 in a road user charges, something many other states have announced for future implementation or discussion. This charge however, can be partially offset by a $100 registration discount for zero emissions vehicles.

The government is investing $19 million in charging infrastructure for regional Victoria and plans to only purchase zero emissions buses (electric or hydrogen) for its public fleet by 2025. It is also planning 400 zero emissions vehicles for its fleet by the end of the next financial year, in addition to more than 100 already under order.

Victoria has also signed up to the COP26 zero emissions vehicle pledge by 2040 and committed to net zero emissions by 2050. (courtesy of RAC (WA))

EV sales target: At least 50 per cent of light vehicles (excluding utes, vans and trucks) to be zero emissions by 2030.

Queensland EV incentives

The sunshine state has been late to the EV party but has arrived with a $3,000 rebate for new EVs. There is one big catch: the so-called grant is only eligible on vehicles priced below $58,000, something that eliminates the top-selling Tesla Model 3 and some of the newer EVs from brands such as Hyundai, Kia and Mazda. Rebate payments start on 1 July, 2022.

Queensland also charges a lower rate of duty on hybrid and electric vehicles. The state has already helped fund the Queensland Electric Super Highway ($10 million) and plans to build on that, including exploring tariffs that reward motorists for charging their vehicles in a way that supports more renewables, lower emissions, and cheaper electricity for all consumers.

The government also says it will investigate “amendments to the National Construction Code to ensure all suitable new buildings are BEV-charging ready”.

Queensland has also committed to net zero emissions for the State by 2050. (courtesy of RAC (WA))

EV sales target: 50 per cent of all passenger vehicles (excluding commercial vehicles) by 2030 and 100 per cent by 2036.

ACT EV incentives

The ACT was one of the early movers on EV incentives, providing a stamp duty waiver on any vehicles emitting less than 130 grams of CO2 per kilometre. That means it also benefits many hybrids, but also captures all EVs. Depending on the internal combustion engine vehicle, the ACT charges duty on vehicle emissions. The potential savings could be between $400 and $1,800 when purchasing a $45,000 vehicle. The benefits are greater when compared to thirstier, more expensive vehicles.

The ACT also provides two years free registration for new and used EVs, potentially saving a few hundred dollars on an efficient small car or thousands compared with the cost of putting a thirstier large vehicle on the road.

Plus, the ACT also provides those who are eligible zero-interest loans of up to $15,000 to assist in buying an EV.

While it has the least land mass to cover, the ACT plans to build on EV charging infrastructure with an additional 50 public charging stations by the end of the year.

The ACT also signed up to the COP26 zero emissions vehicle pledge by 2040 and committed to net zero emissions by 2045. (courtesy of RAC (WA))

EV sales target: At least 30 per cent by 2030, possibly higher.

South Australia EV incentives

Those in the southern state can claim a $3,000 rebate on new EVs priced less than $68,750. There is also a three-year registration exemption on new EVs priced less than $68,750 and registered before the end of June 2025. The government has also committed to aiming for more competitive (lower) electricity costs as part of its Electric Vehicle Action Plan.

Like NSW, an EV road user charge is proposed to begin on 1July 2027, or when EV uptake reaches 30 per cent.

The government is supplying $25 million towards private investment of public charging stations and plans to develop smart charging and hydrogen refuelling hubs by 2025.

SA is planning an EV virtual power plant, which utilises EVs as an electricity storage device that can intelligently communicate with the grid and supply power as required.

SA has also signed up to the COP26 zero emissions vehicle pledge and committed to net zero emissions by 2050. (courtesy of RAC (WA))

EV sales target: 50 per cent by 2030 and EVs as the “default choice” by 2035.

Tasmania EV incentives

Nowhere in the country can leverage the benefits of driving an EV better than Tasmania, which claims all its electricity is generated from renewables, much of it hydro. The state does not charge stamp duty on new and used EV purchases. On a new EV costing $50,000 that means a saving of $2000 and for a $70K car it slashes $2800 off the price. The EV stamp duty waiver is due to end in July 2023.

The Tasmanian government has also doubled its initial $600,000 investment designed to create a state-wide charging infrastructure network incorporating both faster (DC) and slower (AC) charging. The government also plans to transition its entire vehicle fleet – including commercial vehicles – to EV by 2030.

Tasmania has committed to net zero emissions for the State by 2050. (courtesy of RAC (WA))

EV sales target: None specified.

Norther Territory 

Federal Government EV incentives

There are currently no direct EV incentives from the Federal Government.

Instead, it has committed $250 million through its Future Fuels Fund as part of a co-investment with the private sector to expand charging capacity for battery electric vehicles and hydrogen refuelling for fuel cell electric vehicles. (courtesy of RAC (WA))

EV sales target: None specified

Canada

Various incentives in different provinces are in place to encourage the uptake of EVs.

China

Incentives and exemption from annual taxes for pure electric, fuel-cell, and plug-in hybrid vehicles

European Incentives

“Incentives for electrically chargeable vehicles are now applied in all western European countries. The incentives mainly consist of tax reductions and exemptions as in countries such as Belgium and the Netherlands, as well as of bonus payments and premiums in Spain, Luxembourg and Portugal for the buyers of electric vehicles.

The European car industry supports the further introduction of fiscal incentives for fuel efficiency. Tax measures are an important tool in shaping consumer demand towards fuel-efficient cars, and help create a market for breakthrough technologies, notably during the introduction phase. Innovations generally first enter the market in low volumes and at a significant cost premium, and this needs to be offset by a positive policy framework. Electric mobility will make an important contribution towards ensuring sustainable mobility.” (see European Automobile Manufacturers Association).

To list some of the countries that have incentives: Austria (not Australia), Belgium, Czech Republic, Denmark, Estonia, France, Germany, Greece, Ireland, Italy, Luxembourg, Monaco, Netherlands, Norway, Portugal, Romania, Spain, Sweden, United Kingdom

All of the countries labelled as PIIGS during the GFC have incentives for EVs.

United States

Up to $7,500 of Federal Government tax credits are available for Plug in Electric Vehicles (PEVs).  In addition to that many states have additional subsidies ranging from $1,500 to $6,000 that can be applied to PEVs.

India

In January 2013, the Indian government announced a new plan to provide subsidies for hybrid and electric vehicles. The plan will have subsidies up to 150,000 rupees for cars and 50,000 rupees on two wheelers. India aims to have seven million electric vehicles on the road by 2020.
Exemptions:

• New Delhi exemption of VAT up to 12.5% and refund of road tax and registration charges up to 2%.
• Karnataka 4% road tax
• Rajasthan 0% road tax
• Chattisgarh and Rajasthan 0% VAT
• Maharashtra 5% VAT
• Kerala 4% VAT
  

Japan

Japan has had a range of incentives for electric vehicles since 2009.

For a more detailed breakdown of individual country incentives click here