The SA Government is the latest state to pull their rebate being paid to consumers and business purchasing an electric vehicle. The news came late in December and probably impacted novated lease buyers that were planning to place their new car orders in January 2024, unless they were able to get an order placed and contract signed before December 31st 2023.
It follows the announcements during 2023 that the NSW and Victorian state governments were also stopping the $3,000 rebates being paid to buyers of electric cars. Victorians weren’t given much notice when their rebate can cancelled mid-year. Though NSW residents were given plenty of time to plan a purchase before the end of 2023.
WA still offers a $3,500 rebate and as of the end of November 2023 they had paid $12,775,000 for 3,650 electric cars (there’s limit of 10,000 cars).
QLD provides a means tested $6,000 (or $3,000 for everyone). The Queensland Zero Emission Vehicle Rebate Scheme was updated in early 2023 to provide the additional $3,000 (total $6,000) for households that have a total taxable income equal to or less than $180,000 per annum.
NSW is the only state government offering a fleet incentive to encourage businesses to start the transition to zero emission vehicles though changes are expected to the program in 2024 after using a reverse auction process for three rounds of bidding for funding.
The Electric Car Discount Bill was passed by the Federal Government in November 2022 (retrospective to July 2022) which provides an exemption on Fringe Benefits Tax (FBT) for low and zero emission vehicles.
It is now the only nationally consistent scheme providing a benefit to new car buyers interested in purchasing an electric car. Which also makes it the easiest scheme for car manufacturers to promote and support with new models and targeted pricing.
For a novated lease buyer this is an estimated savings of $14,000 per annum on a $70,000 electric car (20% of the purchase value). Much more than the $3,000 offered by the state governments.
It’s also a scheme that appears to be cost neutral because according to comments by FleetPartners in their recent results presentation, orders for novated lease electric vehicles have increased without reducing demand for petrol and diesel vehicles. This suggests it’s incremental volume from households that were using other finance methods to acquire a new car which didn’t require them to pay FBT.