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House of Assembly - Fifty-Fifth Parliament, First Session (55-1)
2022-09-28 Daily Xml
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Motor Vehicles (Electric Vehicle Levy) Amendment Repeal Bill

Second Reading

Adjourned debate on second reading.

(Continued from 18 May 2022.)

Mr TARZIA (Hartley) (16:45): I rise to speak to the bill concerning the Motor Vehicles (Electric Vehicle Levy) Amendment Repeal Bill of recent times. At the very outset, what I want to say is that I will be the lead speaker for the opposition and that we certainly will not be opposing the repealing of the act. What we do want to do is to highlight why the act was introduced, the implications of repealing it and put to the government that there are several aspects of this that require serious consideration.

Obviously we respect the government's commitment to repeal the Motor Vehicles (Electric Vehicle Levy) Amendment Act 2021, but it does leave some serious questions unanswered. We know that in October 2021 the former Liberal government introduced the EV levy act in response to prevailing and emerging EV ownership in South Australia. The former Treasurer was the lead minister for this policy. It was developed in coordination with other state treasurers through the Board of Treasurers Forum. To ensure national consistency as far as possible, the road user charge was modelled on similar schemes in New South Wales and in Victoria at the time.

Since the act's commencement, the last time I checked Tasmanian and also Western Australian governments have also signalled that they will be introducing a similar road user charge. The last time I checked, Queensland remained the only jurisdiction that had not yet contemplated introducing a similar scheme. Currently, there are very few zero and low-emission vehicles in South Australia with, at the time that I checked, EVs making up only just under 2 per cent of new vehicle sales in the state.

In terms of why we needed the act in the first place, without the act the arrangements in place at the time would have resulted in EV owners arguably not paying their fair share of road maintenance and infrastructure through the avoidance of fuel excise taxes levied by the commonwealth government. It would have also helped to pay for government-funded EV charging infrastructure.

The act originally introduced a road user charge for EVs calculated at 2¢ per kilometre (indexed) for plug-in hybrid vehicles and 2.5¢ per kilometre (indexed) for any other EVs. It was due to commence from July 2027 or when EVs reached 30 per cent of new vehicle sales, whichever came sooner. Both, in any event, are a long way away. Motorists who drove petrol and diesel powered cars obviously continued to pay a fuel excise. Given that EVs are battery powered, obviously EV owners can avoid the existing fuel excise.

The introduction of a road user charge is a way for EV owners to pay their fair share for road maintenance infrastructure and contribute to the provision of government-funded EV charging infrastructure. The road user charge was designed to be applied as part of the annual car registration process. This was estimated to result—and I thank the minister for the briefing—in an annual road user charge, and a number was mentioned of around $300 for an average passenger EV, compared with approximately $565 per annum collected from fuel excise for an average passenger internal combustion engine vehicle.

A lower per kilometre charge recognises the environmental and also the health benefits associated with electric vehicles. It is expected that the uptake of EVs will increase, obviously as they reach price parity with internal combustion engine vehicles. If you read recent articles, such as in the Financial Review, there is differing opinion as to when that may occur.

The charge was expected to generate $3.5 million in its first year, increasing to about $11 million in 2028-29. By 2030-31, it is estimated to raise $21 million based on an estimated 40,000 vehicles being subject to the charge. To provide an idea of the long-term revenue potential, if all vehicles were subject to the road user charge in 2021, it would generate approximately $410 million. Revenue raised through the road user charge could have been hypothecated, going into the existing Highways Fund. It was the intention to expand the use of that fund to include the expenditure on the installation and management of charging facilities for the EVs.

My particular opinion is that I believe that this is an area where we need to see stronger national leadership. We need to see stronger national leadership on electric vehicles, especially in this current climate. We know that governments have their challenges in this regard. We know that the fuel excise is in terminal decline while the total number of vehicle kilometres travelled is growing.

Fuel excise emerged gradually as an increasingly unsustainable tax but will quickly become untenable, some say, as those who cannot afford an electric vehicle must foot a growing road bill for those who can. The question is: why should everyone else subsidise the roads when people who can afford, say, a Tesla do not pay anything towards this level? How is that fair and equitable?

The road user charge policy was coordinated through the Board of Treasurers, and while the fuel excise is a federal tax, states have been incentivised to take a first mover advantage in claiming an ongoing revenue stream that is stable and reliable in the form of a road user charge. The previous Liberal government's approach was taken in the absence of national reform, but I think this is an opportunity for the current Labor Albanese government to take the lead.

I know that the current member for West Torrens has a very special relationship with the federal government, and perhaps it is something that he could take up with Prime Minister Albanese, and that is leadership and national reform in the EV area because a national approach would ensure greater consistency between the states and greater coordination of policy across state boundaries. This is a highly fragmented area at the moment.

It may require the states to somewhat cede power and revenue to the commonwealth. Given that the states have moved to roll out the policy in a semi-coordinated fashion without the commonwealth, some of that is going to be difficult to roll back. In the absence of nationally led reform, South Australia risks being one of the only jurisdictions without a policy to deal with the inevitable fall in fuel excise revenue. I know that would be keeping the Treasurer awake at night.

During the development of the legislation, the former Liberal government received support from key industry bodies, including the RAA, Federal Chamber of Automotive Industries and also Infrastructure Partnerships Australia for introducing a road user charge that will help drive the take-up of environmentally friendly, zero and low-emission vehicles while ensuring that there is a long-term sustainable model for critical road funding.

Obviously, there have been some critics of the charge, and I respect that. Critics argue that the charge will discourage the uptake of EVs, which will impact the state's approach to addressing climate change, but there is no reliable evidence to my mind to support this proposition as experienced, for example, in Victoria, where an active road user charge already exists. The take-up of electric vehicles in that state is one of the fastest in Australia.

We know that there are a number of alternative ways to encourage EV take-up, and when I was on another trip I did take the time in the States once to visit the Tesla factory. It was one of the most rewarding things that I did. There is no doubt that this is the future and we have to embrace the future. As I said, I believe the states really do need to work collaboratively with the federal government to develop the right structure around these EVs.

The previous government had a clear path responding to climate change. We know that we aimed to reduce the state's emissions to nation-leading ambitious target levels. In December 2020, we also released a very powerful vision for climate action of any South Australian government in history, I believe. The SA Government Climate Change Action Plan 2021-2025 was developed with input and advice from renowned climate change expert Professor Ross Garnaut. That plan shows that South Australia could achieve a level of renewable energy that is more than five times the current local grid demand by 2050.

To support the passage of the road user charge and the uptake of EVs, the former Liberal government made significant investment of over $36 million to encourage the uptake of EVs, including an $18 million EV subsidy package providing $3,000 in subsidy incentives (we are the party of incentives) for the purchase of up to 6,000 electric vehicles in South Australia—the subsidy is more generous than a similar subsidy offered in Victoria—$13.4 million to accelerate the rollout of a statewide charging network, targeting 53 preferred service locations to deliver approximately 500 rapid and fast-charging stations; and up to $3.6 million for smart-charging trials to demonstrate how EVs can be coordinated to charge during periods of high renewable electricity generation or low demand to support the power grid.

Recognising the market for EVs was still being established, the road user charge was to commence from 1 July 2027, or when the sale of battery electric vehicles reached 30 per cent of new motor vehicle sales in South Australia—which was obviously a long way away but whichever was earlier. The delay in the commencement of the road user charge was in response to feedback received from some groups during the consultation on the draft bill, where a delay in the introduction of the road user charge was sought until there was an increase in the uptake of electric vehicles.

If the act is repealed, we have serious questions that I hope our learned minister may be able to address, because we know that there are some economic arguments that remain unresolved in this regard. Serious questions arise regarding the maintenance and the management of the state's roads. For example, what will the Labor government's alternative sustainable long-term road funding model be to replace the one established under the EV levy act? How will the decision impact the future distribution the fuel excise from the Australian government to South Australia?

If the fuel excise continues to reduce, who is going to fund road maintenance? Where is that bucket of money going to come from? Will the Labor government commit to funding the $36 million EV initiatives announced under the former government? How will future governments be able to maintain safe roads without the cost falling on those who cannot afford an EV? Last time I checked, there was still some disparity. This technology has a long way to go.

Further, how will the revenue shortfall from reductions in the fuel excise be recovered? Will the repeal of the act lead to a reduction in maintenance and quality of road infrastructure? Will the repeal of the act lead to a reduction in road safety?

Whilst we do appreciate the government's mandate, and we can count on this side of the house, I do sincerely hope that the minister takes these economic aspects on board, and I look forward to hearing the government address these concerns. In the long run, as a former road safety minister, I can say this: we know that the regions are over-represented when it comes to lives lost on our roads and, if we allow roads to disintegrate over time, we risk that trend continuing, and we cannot have that. So there are some fundamental concerns.

As I said, we will not be opposing the repeal of the act, but we certainly will, on this side of the chamber, highlight why the original act was introduced, the implications of repealing it and aspects of the act that require serious consideration.

S.E. ANDREWS (Gibson) (16:59): I rise to support the Motor Vehicles (Electric Vehicle Levy) Amendment Repeal Bill 2022. This bill will repeal the new tax that the previous Liberal government introduced because this government wishes to encourage the use of vehicles that have a substantially lower impact on our environment.

The levy was a distance-based charge for electric vehicles as an addition to the registration of an electric vehicle—a penalty, in fact, for those who want to reduce emissions. From the levy's commencement, electric vehicle owners would have been charged 2¢ per kilometre travelled in a plug-in hybrid vehicle or 2.5¢ per kilometre for any other electric vehicle.

Why was this tax applied allegedly as a substitute for fuel excise which is a federal tax? It is not a like-for-like tax and would contribute nothing to new roads or infrastructure in South Australia. The estimated $1 million would have gone into general revenue and potentially funded further Liberal waste rather than worthy projects.

The former state government, like its federal counterparts, did not value the environment. The now Leader of the Opposition chipped away at small projects while neglecting our River Murray. Our government is taking a national approach and accessing the best experts from across Australia by contributing to Australia's first National Electric Vehicle Strategy, led by federal Minister for Climate Change and Energy, Chris Bowen.

This government is taking the opportunity for South Australia to lead the way, rather than imposing taxes that would hurt the growth in electric vehicles. The levy introduced by the previous government would have been a major disincentive to purchasing an electric vehicle. While the road user charge would not have commenced for some time, passing this repeal bill as soon as possible will provide certainty for those looking to purchase an electric vehicle.

A survey undertaken by the Australia Institute in 2021 showed that seven in 10 South Australians would be less likely to purchase an electric vehicle if a new road user charge were to be introduced, seven in 10 South Australians who would choose petrol or diesel vehicles over electric due to the tax imposed by the former government. So 2¢ or 2.5¢ per kilometre may not sound much, but with the rising cost of living every cent counts.

Abolishing the levy will deliver on another government election commitment because the Malinauskas government is a government that delivers on its commitments and listens to South Australians. This government is not just axing the tax but also encouraging the uptake of electric vehicles. There are average annual savings estimated for electric vehicle adopters for fuel costs and maintenance costs.

This bill will support the uptake of electric vehicles by preserving financial benefits for the ownership of electric vehicles over internal combustion engine vehicles. Electrifying our transport fleet is a vital part of the overall transition from carbon-emitting technologies to a greener, cleaner future that accords with our state parliament's recent declaration of a climate emergency.

Passenger cars make up almost 10 per cent of Australia's CO2 emissions. Supporting the uptake of electric vehicles will contribute to South Australia's ability to achieve net zero emissions. Our state government is delivering 7,000 electric vehicle purchase subsidies of $3,000 and a three-year registration fee exemption. I know that this is music to the ears of Sally Knight, the Chair of the Australian Electric Vehicle Association in South Australia and one of my constituents in Gibson. Incentives, not taxes. Support, not additional costs.

This government is supporting the RAA to construct the state's first electric vehicle charging network of over 500 charging stations at 140 sites in 52 locations around South Australia. The South Australian government awarded a grant of almost $12.4 million to the RAA to construct and operate Australia's first statewide electric vehicle rapid charging network. The network will comprise 536 fast and rapid chargers across 140 electric vehicle charging stations in 52 rural, regional and metropolitan service locations.

While exact locations are still being finalised, there are plans for 26 sites in Adelaide, including 10 in the CBD. The RAA will start the design and construction of the EV charging network in supermarkets, car parks, town centres, council-owned sites, hotels and motels throughout South Australia. It is anticipated that the network will be finalised by the end of 2023. The rural and regional sites will provide certainty for electric vehicle owners travelling across our state and will forever kill the myth of the former federal government that the rise of EVs will end the weekend.

Additionally, our government is progressing nine electric vehicle smart-charging trials to demonstrate how electric vehicle charging can be integrated into the grid to realise electricity cost savings for all South Australians. As part of these government-supported trials, smart-charging stations will be installed across metropolitan and regional areas, including shopping centres, off-street car parks, hotels, motels and holiday parks.

The smart-charging trials will demonstrate ways electric vehicle drivers can be incentivised to charge during periods of high renewable electricity generation or low grid demand. This will support the grid, reducing electricity costs for all consumers. Some trials involve vehicles providing electricity back to the grid, acting as batteries on wheels.

New business models are also being trialled that will improve charging service availability and improve financial sustainability for operators. This will include tapping into new revenue streams, such as frequency services in the National Electricity Market, which will reduce operator reliance on charging service fees for financial viability. In total, there are nine recipients of the $3.2 million in grant funding.

The trials will deliver a total of 142 new fast and rapid electric vehicle charging bays for South Australian motorists and attract around $4.8 million of private investment in the development and construction. The trials will also lead to 12 months of data collection and knowledge sharing for innovative smart-charging infrastructure and systems.

I am proud to see three of these trials will be in or very close to the electorate of Gibson. The first trial is the Jolt trial in Marion. This trial will tap into drivers' instincts to seek a bargain at the bottom of the fuel cycle. Using roadside LCD advertising displays and in-app notifications, Jolt will promote low-cost surge pricing to activate consumer behaviour to turn in and save during incentivised times. The key objective of this trial will be to quantify the impact of charging incentives on consumer behaviours and demonstrate the role that EVs can play to balance electricity supply and demand loads during the day.

The second local trial is being run by ENGIE in car parks 2, 3 and 9 at Flinders University. This is one of Australia's largest vehicle-to-grid trials, with ENGIE integrating 22 managed smart-charging stations into a campus-level virtual battery to demonstrate how electric vehicles could be harnessed to support South Australia's electricity system during peak demand periods. The trial will demonstrate the alignment of electric vehicle charging and discharging to periods of renewable generation or grid demand through participation in ENGIE's South Australian Virtual Power Plant.

The final trial is with Planet Ark Power at the Foodland Pasadena Shopping centre. This trial includes the installation of 14 fast and rapid charging bays and a battery energy storage system that will store as much renewable electricity as 125 home batteries. The trial will measure benefits including renewable energy use, customer satisfaction, return visits, and the economic value to shopping centres of electric vehicle charging stations.

The smart chargers will fully charge an electric vehicle in 15 to 45 minutes as a customer enters the shopping centre and activates the electric vehicle boost, enough time to complete a shop at Foodland, browse the local specialty shops or grab lunch. Once completed, the battery storage system here will be the first of its kind built at a South Australian shopping centre. These are three very exciting trials and I encourage all electric vehicle owners in the south or east of Adelaide to utilise these facilities and motorists from across Adelaide to look out for other trials underway.

There are over 6,500 vehicles in the South Australian government fleet. In total, these vehicles travel around 110 million kilometres, equating to over 21,000 tonnes of CO2. There is a requirement for South Australian government agencies to transition to plug-in electric vehicles if they are cost effective on a total cost of ownership basis or if the additional cost can be managed by improving fleet utilisation.

The benefits of the orderly transition of our government fleet to electric vehicles will be twofold. It will meaningfully contribute to lowering our state's carbon footprint and help us to achieve net zero emissions. Additionally, it will help saturate the second-hand market with electric vehicles, reducing a current lack of availability as well as reducing the up-front cost for people looking to purchase an electric vehicle.

It would be remiss of me not to mention that South Australia has been part of the World Solar Challenge since 1987 and, further, that the global Formula E series is looking at Australia as a future destination for a round. Sally Knight would like to see an electric Adelaide 500, which I personally believe would be a very exciting event, especially given the huge support we have for the traditional Adelaide 500. I look forward to that race in December. I commend this bill to the house.

Ms HOOD (Adelaide) (17:11): I rise to speak in support of the Motor Vehicles (Electric Vehicle Levy) Amendment Repeal Bill. When I look at my two young children, Audrey and Ned—they are six and three—I realise that they will never stop at a servo to fill up their car's tank with petrol because they will really only know driving electric vehicles, but I do not want to have to wait 10 years until Audrey is due for her learner's permit, as terrifying as that will be, for this to become commonplace.

The quicker we can reach this new reality, the better for everyone, and this repeal bill is a step in the right direction. When the former Marshall Liberal government announced last year its tax on electric vehicles, my overwhelming feeling was actually embarrassment. It was up there with ScoMo carrying a lump of coal into parliament, labelling our big battery 'the Big Banana' and claiming electric vehicles will ruin your weekend. It really was the ultimate facepalm moment for the former Liberal government.

Under previous Labor governments, we had become a world leader in renewable energy technologies, from the Tesla-Neoen battery at Hornsdale Wind Farm at Jamestown, where I was proud to be on the night it was switched on, to our huge uptake in solar PV as well as our plans to establish a green hydrogen industry here in South Australia. We have a track record and a vision to be proud of, but here was the former Marshall Liberal government, actively going out of its way to disincentivise the purchase of greener electric vehicles.

The levy unsurprisingly received community backlash for the message it sent to road users thinking of opting for a green-energy vehicle option. As the member for Gibson earlier stated, a survey undertaken by the Australia Institute in 2022 showed seven in 10 South Australians were less likely to purchase an electric vehicle if a new road user charge were to be introduced. We want more South Australians to be making more environmentally friendly choices, not putting barriers and penalties in the way that will dissuade them.

That is why we committed during the election campaign to introducing this bill to repeal the Liberals' tax on electric vehicles; in fact, this bill will repeal the tax before it even starts to take effect on South Australians. In the current climate emergency, as declared by the Malinauskas Labor government recently, this bill will support our efforts to reduce and mitigate our carbon emissions. To increase the number of electric vehicles on our South Australian roads is to reduce the state greenhouse gas emissions from transport and improve our air quality, which benefits everyone.

This bill, in conjunction with many of our other election commitments, shows our communities that we are committed to a greener, more sustainable future for South Australians. For the benefit of our state, we should be encouraging environmentally friendly modes of transport like electric vehicles, not disincentivising them. I commend this bill to the house.

Mr HUGHES (Giles) (17:14): I also rise to speak in support of the Motor Vehicles (Electric Vehicle Levy) Amendment Repeal Bill. I will probably bring a bit of a country perspective, and in doing that I think that I will provide a bit of a framework.

Some of the opposition might say, 'Well, there are hardly any electric cars out in the country,' which is entirely true, but it is very clear what is going to happen in the very near future. We are going to see the rollout of high-quality charging infrastructure in regional South Australia, which will be a real plus, and the big element is going to be the reduction in the cost of vehicles.

As it is already, when it comes to a recurrent cost basis electric vehicles beat internal combustion engines hands down, but they are still expensive. The cars are still expensive for a range of reasons, but especially in Australia given the limited choice thanks to the previous federal government and its incredibly hostile approach to electric vehicles—those things that were going to destroy our weekend.

As a member of parliament from a regional electorate, I am particularly concerned about how the legislation affects my constituents and other South Australians living beyond city limits in comparison to how the legislation affects people in the Adelaide metropolitan area. The Liberal Party's electric vehicle levy act is a great example of how legislation can disproportionately disadvantage people in regional and remote areas. It was legislation that the Labor Party opposed from the word go. It was legislation that I spoke against in October last year when I said that there were many positives to be gained from electric vehicles, and that their uptake should be encouraged. Putting taxes on things does not encourage uptake.

I said that EVs should not be discouraged by slapping extra costs on electric-vehicle-owning motorists. At the March election, many thousands of voters in regional areas realised that the Liberal Party do not act in their best interests—just look at the votes. It is another of those myths that do the rounds: the idea that the Liberal Party are the natural party of regional people. What thousands of regional voters realised was that the Liberal Party, especially the leadership of the Liberal Party, were city slickers who had no understanding or empathy for regional voters and country people's issues of concern. Instead, the Liberals take regional votes for granted.

The EV levy was a new tax on motorists created by the Liberal Party. It had no precedent as a state tax. Because the Liberal Party do not see things from the perspective of life in the regions, they clearly did not consider how their new tax would be especially detrimental to the residents of South Australia's regional and remote areas in the not too distant future.

It almost goes without saying because it is so intuitive, but perhaps I need to spell it out to those opposite: country people do a lot of driving, I do a lot of driving, and most of the people I know do a lot of driving. If you live on a farm, you are going be driving a lot further to and from your local shops and service centres than somebody living in the suburbs who simply pops down to their local Foodland, Coles or Woolies.

If you have kids at school, there is going to be a lot of driving to get them to everyday events, especially if they have extracurricular activities even with the school bus services in regional areas—at least in some regional areas. If you or your kids play sport, buckle up because you are going to be driving—in some cases, extraordinarily long distances—just to get to a game on a Saturday or a Sunday, and it is much the same for residents of country towns.

Many parents spend hours ferrying their kids to special school events that do not occur in their communities or to academic courses or to play sport. If you need a specialist, or any medical treatment in the city or other services in the city, you are in for a long haul. Can you imagine being a pensioner living in Coober Pedy and having to drive all the way to Adelaide to access services?

Do not get me wrong: we country people love where we live and we would not exchange our lifestyle for living in the suburbs in Adelaide, but we strongly object to government imposing a new tax which hurts us more than it would hurt the residents of Unley, Burnside or South Brighton, which of course falls in the member for Black's electorate. The EV levy would affect regional residents more because it was designed to be levied according to how far you drive.

Country residents who drive considerable distances every year would pay a lot of tax. Inner-city residents, who do not need to go far to get to work, school, sport, shopping or services, would not pay nearly as much tax. Indeed, there is a whole bunch of people in the inner city these days who do not even have a car. Their services are at hand and they are incredibly well served when it comes to public transport. You do not get that in regional communities.

This tax is in contrast to existing state-based taxes and charges on motorists. When you register and pay compulsory third-party insurance on your vehicle, a lower rate will apply if you live in a regional area. If you own a four-cylinder sedan or station wagon, it will cost you $685 a year in metropolitan areas and $560 a year in country areas. The same rates—$685 in the metro zone and $560 in the country—apply to electric vehicles.

A favourable differential between the regions and the city has long been accepted and supported by the public, by members of parliament, that is until the sad moment in South Australia's history when the Liberal Party was in government and the member for Black and his colleagues sat around the cabinet table and came up with a new tax on South Australians, a tax which unfairly targeted motorists living in regional areas. Compare that lack of concern for regional voters with how this government, the Labor government, has considered regional residents.

In the 2022-23 budget, brought down by the Treasurer, a vehicle registration concession of 50 per cent was brought in for residents of outer areas, including Kangaroo Island, Coober Pedy, Roxby Downs and all the unincorporated areas. Consider that. That concession was in place for many, many years under both Liberal and Labor governments because they recognised the additional costs incurred by country people when it came to travel, when it came to servicing their vehicles and when it came to the incredibly high cost of fuel, especially in the more remote communities.

That is one of the differences between Labor and the Liberal Party. On this side, we look after all South Australians, including people living in regional areas. Those opposite do not think things through, and they make decisions which hurt regional people. That is one of the reasons we are determined to lift the yoke of this new tax off the shoulders of our regional residents.

Let us consider another aspect of this new tax which demonstrates how the Liberal Party does not think things through. In his budget speech, when he announced this new tax, then Treasurer Rob Lucas downplayed its impact, saying it would not cost South Australians very much. The levy was estimated to raise about $1 million a year, Mr Lucas said. Yes, the levy might not have raised much in its first year, given the still low number of electric vehicles on South Australian roads, but it was disingenuous not to be up-front with the South Australian people about how much they would be paying under the new tax in the years to come. All major vehicle manufacturers are moving to change the vehicles they offer from internal combustion to electric.

The Australian Energy Market Operator conducts extensive and detailed research into energy use now and in the future. As part of its Integrated System Plan, the blueprint for the electricity grid, AEMO has worked with the CSIRO to estimate how many electric vehicles we should expect to be on the road in the coming years. AEMO models several different scenarios, but it is instructive to look at one of the ones in the middle rather than the extremes, the so-called step-change scenario which has to date come closest to reality.

In AEMO's step change, it expects the number of electric vehicles, aggregating fully electric vehicles and plug-in hybrid electric vehicles, to increase in South Australia from fewer than 4,000 now to 264,000 by 2030-31. You can go and have a look at all of their assumptions. They lay them all out very well.

By 2040-41, that forecast is to grow to more than one million EVs registered in South Australia. This change is going to gather pace as time goes on. Do not be fooled into thinking EVs are only city runabouts or fancy sports cars for the wealthy elite. I will acknowledge that at the moment electric vehicles are aimed at the high end of the market. This will not last. This will change and this will change quite rapidly.

There has been a lot of nonsense put out recently by the Liberal Party that you will not get an electric ute, as one example. Actually, there is a grain of truth in that, but not because the car makers do not make utes, but rather because they will be in such demand they will be difficult to buy. There is another factor here in Australia. Given the hostility of the previous federal government to electric vehicles and their lack of policy, Australia was not seen as an attractive market for EV producers overseas. That is going to change.

Look at what is happening in the USA: Ford's F-150 Lightning electric ute has been so popular the company has stopped taking any more orders. Bear in mind, the United States are really into some heavy duty vehicles, more so than just about any other advanced country, but the uptake of this ute has been extraordinary. There is a whole range of other utes coming down the track. General Motors, Tesla, Rivian and a host of other manufacturers have utes in production or on the way.

Regional SA residents will drive EVs and there will be plenty of utes on the market to choose from. Country people are incredibly practical. We are waiting for the changes to happen. As I said, we are waiting for the rollout of the infrastructure and we are waiting for the cost of vehicles to come down. As soon as the cost of vehicles come down and that infrastructure is in place, the change is going to be rapid. You imagine going fishing or camping with a ute with its powerful battery. The things that you could do at your campsite thanks to that ute are going to be pretty amazing.

In South Australia at the moment, we have 1.478 million registered vehicles. Collectively, we travelled more than 17 billion kilometres on SA roads in 2020-21, according to the Bureau of Infrastructure and Transport Research Economics. Let's calculate how much money the new Liberal tax might be expected to raise and therefore how close to the mark the Liberal Party was with their $1 million a year estimate.

With the number of registered vehicles at 1,478,000, and the distance travelled at 17 billion kilometres, the vehicles averaged 11,500 kilometres a year. As I have argued earlier, regional motorists would do a lot more than that, but for simplicity's sake let's stick with that simple average. The Liberal tax set a rate of 2¢ (indexed) per kilometre for a plug-in hybrid, and 2.5¢ (indexed) per kilometre for a battery electric vehicle. There are probably more battery electric vehicles than hybrids on the roads, given the dominance of Tesla, but, again, for simplicity, let's say the 4,000 total is half. We will not go into the detail, so we will just say the number of vehicles attracting a levy at 2¢ and at the higher rate of 2.5¢.

What that means, when you look at what is going to be raised at the moment, is that it is not much. When you combine the two of them, it is just over $1 million. It is $460,000 a year for the hybrids. For the battery electric vehicles, at the moment, given the distance they travel and the 2.5¢, it equals $575,000 a year. So it is very close to the Lucas estimate for one year. But wait, there is more—a lot more. It is no wonder that, despite the glint in his eye, Mr Lucas stopped short of coming clean about how big that tax burden on South Australians would grow.

If we keep the same conservative estimate of half plug-in vehicles and half electric, a motorist continuing to travel about the same distance each year, then the tax revenue would increase considerably. In 2030-31, it would increase to more than $80 million a year and, by 2040-41, South Australians will be forking out a completely new tax, a completely new state tax—$392 million—because of the new Liberal tax. As I explained earlier, an unfair proportion of that would come from the pockets of regional residents.

No wonder regional voters have deserted the Liberals. Indeed, in one of the booths in my electorate, an incredibly strong Liberal booth, I lost it by four primary votes. I was very close to winning it. In Roxby Downs, where I used to get 32 per cent two-party preferred vote, I now get 62 per cent of the two-party preferred vote. They are sending you a message.

I am sure Treasurer Stephen Mullighan would love to have an extra close to $400 million a year coming into his books, but Mr Mullighan, like all members of parliament on this side of the house, knows that it is our duty to look after South Australians, all South Australians. We are not the party that gouges taxpayers. Gouging taxpayers is the prerogative of the Liberal Party, especially when it comes to regressive tax—because this will be a regressive tax.

As I said when this levy was proposed and debated in this house last year, EVs are going to be a real plus. Their recurrent operational costs are significantly lower than the cost of running and maintaining a fossil fuel vehicle, and their operational costs are much more stable than those of internal combustion vehicles.

For too long, we have been subject to price rises at the petrol bowser as some faraway event puts pressure on the price of oil, and this is especially so in country areas. When something goes wrong overseas, the price of diesel and the price of petrol in a place like Coober Pedy are just massive. They are just absolutely massive, and that is before the current set of circumstances. What those people had to dish out was just huge, and that went for all those remote communities when it came to the cost of fuel.

With EVs, we have the opportunity to break that nexus, to break that dependence on overseas oil when it comes to our vehicles. This is going to be a huge plus, and it is going to be an absolutely huge plus in a state that is blessed with this massive global quality solar resource and massive wind resource that overlaps that solar resource in a significant part of our state. We should be doing all that we can to encourage the uptake of electric vehicles. The Labor Party looks forward to a cleaner, more affordable future, a future in which EVs will play a big part.

I have been going on about the country, but if you are in the city one of the advantages of the shift to electric vehicles, whether it is the light vehicle fleet or some elements of the trucking fleet, is that you get rid of all that particulate emitted by internal combustion engines. Look at the figures in this nation when it comes to the number of people estimated to die each year, largely in the metropolitan areas, as a result of particulate pollution most of which comes from vehicles.

We do not have that problem to anywhere near the same degree as a place like Whyalla. You might say Whyalla is industrial but, I tell you what, the atmosphere in general is better than in a lot of parts of Adelaide. Thanks to vehicles and internal combustion engines—they have served their purpose. Their day is coming to an end, so we should all be welcoming electric vehicles. We should all be encouraging electric vehicles. We should not be putting disincentives in place when it comes to taxes. We should be encouraging what is a good thing. That is why this new tax devised by the Liberal Party must be scrapped right now

Debate adjourned on motion of Mr Odenwalder.


At 17:34 the house adjourned until Tuesday 18 October 2022 at 11:00.


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