Oops! The Victorian government has forgotten about hybrids…

Let’s hope none of those fiscally responsible pollies in the Victorian government wake up to the huge hybrid tax dodge.

As the state that throws more fossil fuel into coal-fired power stations than any other part of Australia prepares to tax electric vehicles 2.5 cents for every kilometre they travel, the government is seemingly missing the bigger opportunity to tax hybrid cars.

Hybrids, you see, pay around half the fuel excise of similarly sized conventional cars with no electric motors and batteries as a backup. In other words, they’re using just as much road but paying half in road taxes compared with the car idling next to them in traffic.

And because they’re usually heavier than an equivalent non-hybrid car, those hybrids would also place marginally more wear and tear on the roads. So, if anything, they should be paying more to use Victoria’s heavily-policed roads.

Of course, the idea of taxing hybrids or EVs purely because of the drivetrain beneath their skin is ludicrous. I’m merely trying to prove a point, so stick with me…

Let’s throw some numbers at it.

Last year Australians bought about 7000 EVs. None paid any fuel excise because, as the phrase suggests, the charge only applies to fuel – petrol and diesel – and is charged at 42.7 cents per litre. Let’s forget that EV owners paid plenty more in GST and, in many cases, luxury car tax, because right now they’re more expensive than ICE vehicles. And let’s also ignore the inconvenient fact that GST is charged on the electricity they use.

If we assume an equivalent petrol car may have used around 9 litres per 100km and travelled an average 13,000km then that’s $3.5 million in lost federal revenue that would have eventually flowed through to the states and territories.

Hence the Victorian government’s desperate (and flawed) attempt to address such injustice (another thing you’ll have to ignore for the sake of this argument is the sizeable public health benefits those EVs bring; perhaps they should pay less in taxes for the amount they’re saving in respiratory diseases that are treated in hospital…).

But hybrids are having a far bigger impact on fuel excise revenue.

Last year 60,417 hybrids were sold in Australia.

Assuming the average hybrid used about 5L/100km, well below the 9L/100km of a similar non-hybrid.

This means there’s something like $13.3 million less fuel excise revenue making it into government coffers.

Sure, drivers of hybrids pay some fuel excise where EV owners pay none. But using conservative figures hybrids have almost four times the impact on fuel excise revenue than the relatively small numbers of EVs being sold.

Now we’re not saying EVs shouldn’t pay their way. But using the Victorian government’s flawed thinking hybrid drivers should also be paying more.

The way the 2.5c/km road user charge has been proposed by the Victorian government is madness – and there are far bigger targets to aim at (mining companies would be a start!).

Here at EVcentral we’re not opposed the idea of a road user charge. Clearly infrastructure construction and road maintenance needs to be paid for, and the best people to pay for it are those using the roads.

But don’t single out particular types of vehicles and ignore all the others. Implement a road user charge across the board – ICE, EV and everything in between – and make it proportional to the damage and pressure those vehicles put on both the road network and the environment.