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Legislative Council - Fifty-Fifth Parliament, First Session (55-1)
2023-02-07 Daily Xml
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Bills

Motor Vehicles (Electric Vehicle Levy) Amendment Repeal Bill

Second Reading

Adjourned debate on second reading.

(Continued from 1 December 2022.)

The Hon. R.P. WORTLEY (15:54): In November 2021, the former Liberal government passed its Motor Vehicles (Electric Vehicle Levy) Amendment Bill 2021. The act introduced a levy on electric vehicles and a requirement for the Legislative Council to appoint a select committee into electric vehicles.

The levy is a distanced-based charge for electric vehicles as an addition to the registration of an electric vehicle. The levy was to commence on the earlier of 1 July 2027 or when battery electric vehicle sales reached 30 per cent of total new motor vehicle sales in South Australia.

From the levy's commencement, electric vehicle owners would have been charged 2¢ per kilometre travelled in a plug-like hybrid vehicle or 2.5 per cent per kilometre for any other electric vehicle. This levy would have been calculated by distance travelled each year and billed as part of the vehicle registration process.

The former Liberal government estimated that this new tax would raise $1 million each year. It is unclear how this was calculated and falls well short of reasonable estimates that consider current uptake trends of electric vehicles. The former Liberal government advertised this state tax as a substitute for fuel excise, which is a federal tax. It is not a like-for-like tax; it is a new tax.

Fuel excise will come under pressure as more electric fuels come onto our roads. However, addressing this should be led by the commonwealth government. The former state Liberal government saw the failure of their Coalition counterparts to put together any policy to address this emerging issue as an opportunity to implement their own tax.

The tax would see raised funds spent in any manner that the Liberal government pleased. The former Liberal government did not consider how implementing a new tax bypassing the commonwealth government would affect the state's collection of GST funds.

In regard to the select committee, schedule 2 of the amendment act required the Legislative Council to appoint a select committee as soon as possible one year after the schedule commenced on 4 November 2022. The committee was to consider longer term issues relating to the use of electric vehicles and recommend a strategy to address these issues.

The repeal bill removes the requirement for this select committee. The Malinauskas government will contribute to Australia's first National Electric Vehicle Strategy, led by federal Minister Bowen. South Australia's levy repeal bill will repeal both the electric vehicle levy and the requirement for a select committee. Abolishing the levy will deliver on a government election commitment.

A survey taken 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. The levy introduced by the previous government would have been a major disincentive to purchase an electric vehicle. While the road user charge would not commence for some time, passing this repeal bill as soon as possible will provide certainty for those looking to purchase an electric vehicle.

There are average annual savings estimated for electric vehicle adopters for fuel costs and maintenance costs. UBS Global estimates that consumers will save $1,700 per annum by 2030 on the total cost of ownership of electric vehicles over internal combustion engines. The bill will support the uptake of electric vehicles by preserving these financial benefits.

Electrifying our transport fleet is a vital part of the overall transition from carbon-emitting technologies to a greener, cleaner future that accords with state parliament's recent declaration of 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.

During the 2022 federal election campaign, the federal ALP released its Driving the Nation plan, which is in the Driving the Nation policies, Australian Labor Party, alp.org.au. It will establish a truly national electric vehicle charging network with charging stations at an average interval of 150 kilometres on major roads, create a national hydrogen highways refuelling network and set a low-emission vehicle target for the commonwealth fleet of 75 per cent of new leases and purchases by 2025.

With thousands of vehicles in the commonwealth fleet, it is big enough to encourage more electric vehicle model introductions to Australia and to expand a resale market. Commonwealth Labor has also made electric vehicles cheaper through the removal of fringe benefits tax and the 5 per cent import tariff for eligible electric vehicles. The fringe benefits tax changes mean a $50,000 electric vehicle can be up to $4,700 cheaper each year for someone using a salary sacrifice arrangement. An employer can save $9,000 a year, an incentive that is critical for fleet buyers and, in turn, the second-hand market.

During the National EV Summit in August, the commonwealth government announced its commitment to develop Australia's first National Electric Vehicle Strategy. The South Australian government has been invited to be part of the development process and is strongly supportive of a federally led approach in addition to our state-based support and initiatives. The EV strategy will be a road map to achieve the following goals: it will make EVs more affordable, drive more choice in the market, drive EV uptake, reduce emissions, save us money on fuel and ensure we are taking advantage of local manufacturing opportunities.

Consultation for the EV strategy will include exploring options for the introduction of fuel efficiency standards. The lack of such standards in Australia is cited as one of the factors impacting the supply and cost of electric vehicles. This is because manufacturers prioritise markets that show leadership. While Australia does not show leadership, consumers are not getting the choice available internationally. We are at risk of becoming a dumping ground for older technology that cannot be sold in other markets.

A low number of EVs are available on the market. This is part of the slow electric vehicle uptake. There are higher up-front purchase prices. Consumers in the United Kingdom can choose from 26 low-emission vehicles under $60,000: the number is only eight in Australia. There is anxiety about electric vehicles' range, performance and limited charging infrastructure.

The current South Australian government support and initiatives include 7,000 electric vehicle purchase subsidies of $3,000 and three-year registration fee exemption, supporting the RAA to construct the state's first ever electric vehicle charging network of over 500 charging stations at 140 sites in 52 locations throughout South Australia and progressing nine electric vehicle smart-charging trials to demonstrate how EV charging can be integrated into the grid to realise electricity cost savings for all South Australians.

As we continue to grow the number of electric vehicle drivers, they will undoubtedly demand charging systems and infrastructure that help allay road trip anxiety and deliver charging at the lowest possible cost. 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 charging stations in 52 rural, regional and metropolitan locations.

While the exact locations are yet to be finalised, there are plans for 26 sites in Adelaide, including 10 in the CBD. The current planned locations will remove range anxiety and provide certainty for people travelling between Adelaide and Renmark, Mount Gambier, the state borders and more.

The RAA will start the design and construction of EV charging networks 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 EV charging network map shows the towns where you will be able to find the charging stations. The exact locations will be confirmed soon.

As part of the government-supported electric vehicle smart-charging trials, smart-charging stations will be installed across metropolitan and regional areas, including shopping centres, off-street parking, 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 and reduce 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 $3,200,000 grant funding. In December 2021, the former state government announced the following successful grant recipients: AGL with Wilson Parking, Chargefox, JET Charge with the NRMA, Jolt Charge, and the City of Adelaide with UPark. On 25 June 2022, the state government announced additional successful recipients of EV smart-charging trials. A media stand-up was held at the Foodland at Pasadena. The successful recipients were ENGIE with Flinders University, JET Charge, JET Charge with Rocland, and Plant Ark Power with Foodland Pasadena.

The trials will deliver a total of 142 fast electric charging bays for South Australian motorists. The trial attracts around $4.8 million of private investment in development and construction. The South Australian government will not generate an income from these trials. The trials will provide information on how smart chargers are used and inform future direction and infrastructure investment as the charging network expands and develops. The trials will lead to 12 months of data collection and knowledge sharing for innovative smart-charging infrastructure systems.

For AGL with Wilson Parking, the location will be Wilson Parking Adelaide CBD car parks and businesses and private locations for the City of Marion, Uniting Communities and Centacare. AGL will trial a one-stop shop for EV fleet transition by bundling the supply of an electric vehicle and smart-charging solutions on a simple subscription.

The trial seeks to overcome key barriers to EV fleet uptake, including overnight smart-charging at employees' homes and smart fleet charging in public car parks. Adelaide CBD businesses will benefit from convenient electric vehicle charging in Wilson car parks. AGL's metropolitan partners, Centacare, Uniting Communities and the City of Marion, will trial a variety of EV models with smart workplace and home charging.

For Chargefox, the location will be at Port Adelaide Plaza. In a globally significant trial, Chargefox will introduce a time-of-use pricing model on a metropolitan DC rapid charger, which will tap into consumers' fuel cycle mindset and encourage electric vehicle drivers to charge during periods of high renewable energy generation. Moving away from conventional fixed price charging models, the trial will test how drivers respond to different time-of-use charging prices to see if EVs can be harnessed to soak up surplus renewable energy generation.

For JET Charge with the NRMA, the location will be the NRMA Victor Harbor Beachfront Holiday Park. The NRMA and JET Charge EV Smart Holiday Parks Trial will demonstrate an electric vehicle charging service model for holiday parks that will enable guests to park, plug and holiday. The integration of electric vehicle charging into holiday parks means there will be more time for relaxation, rather than lost time from recharging at highway stations. Guests will be incentivised to charge during periods of high renewal or energy generation or low demand, which will reduce the costs for EV travellers and holiday park owners.

Jolt Charge location: there will be four metropolitan public charging locations in the Charles Sturt, Port Adelaide Enfield and Marion local government areas. Jolt's 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 provide 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 behaviour and to demonstrate the role that EVs can play to balance electricity supply and demand loads during the day.

City of Adelaide UPark locations at UPark Topham Mall and UPark Wyatt Street in the Adelaide CBD: the UPark electric vehicle fleet smart-charging trial will provide uncomplicated and commercially attractive EV charging to UPark's fleet customers for a fixed, all-inclusive price. Using smart technologies and real-time price signals from the wholesale electricity market, the trial will optimise self-consumption of onsite solar, PV and contracted renewable energy to demonstrate how CBD-based electric vehicle fleets could be orchestrated to strengthen South Australia's electricity system.

ENGIE with Flinders University at the Flinders University car parks 2, 3 and 9: in one of Australia's largest vehicle to grid trials, ENGIE will integrate 22 managed smart-charging stations into a campus-level virtual battery to demonstrate how EVs 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.

JET Charge: location will be at the Adelaide CBD or the metropolitan commercial car parks. The trial will demonstrate how fleets located at commercial building car parks can move to a low-emission transport future by adopting a third-party service model approach to EV smart-charging. It will also demonstrate how EV smart-charging can be provided as a service in commercial buildings using a world-class modular electric vehicle smart-charging system that can be expanded as EV fleets grow. Through a third-party ownership model, the trial seeks to overcome costs and ownership barriers to fleet uptake of EVs as building owners and their tenants are not required to outlay the up-front cost of deploying EV charging equipment.

JET Charge with Rocland: location will be at Rocland Estate Wines. JET Charge and Rocland Wines, at the Sturt Highway service station in Nuriootpa, will demonstrate how rapid electric vehicle charging using time-of-use tariffs and surge pricing or dynamic power delivery can support and positively influence regional EV charging behaviours. The trial will demonstrate how essential highway electric vehicle smart-charging can contribute to overall electricity system strength without adversely impacting upon electric vehicle driver perceptions or user experience.

Planet Ark Power with Foodland Pasadena located at the Foodland Pasadena shopping centre: the 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 at Pasadena will incentivise EV drivers to enter the shopping centre to boost their charge, which could be through pricing, length of charge or validation of charging reward.

The trial will measure benefits including renewable energy use, customer satisfaction, return visits and the economic value to shopping centres of EV charging services. The smart chargers will fully charge an electric vehicle in 15 to 45 minutes as a customer enters the shopping centre and activates the EV boost. Once completed, the battery storage system will be the first of its kind built at a South Australian shopping centre.

I would like to talk about electrifying our government fleet. 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 achieve net zero emissions. It will help saturate the second-hand market with electric vehicles, reducing the lack of availability and reducing the up-front costs for people looking to purchase an electric vehicle. Friday 9 September is International Electric Vehicles Day, so I urge all members of this chamber to support the bill.

The Hon. T.T. NGO (16:15): I rise to support the Motor Vehicles (Electric Vehicle Levy) Amendment Repeal Bill 2022. This bill will abolish the new tax that the previous Liberal government introduced. In November 2021, the former Liberal government passed its Motor Vehicles (Electric Vehicles Levy) Amendment Act 2021. The act introduced a levy on electric vehicles and a requirement for the Legislative Council to appoint a select committee into electric vehicles.

Labor went to the 2022 election promising to scrap this tax because we want to promote, not discourage, the use of vehicles that have a lower impact on our environment. We want to give South Australians a sense of certainty about purchasing an electric vehicle; revoking this levy will help to do that.

The former Liberal government showed a lack of regard for the people in the community who want to have a green vehicle option. The former Liberal government's levy was discouraging environmentally friendly transport options. We must send the right signals to our younger generations, who are the future drivers. The Labor Malinauskas government knows our younger generations understand the importance of acting on climate change. We are listening to their voices as we develop policies and programs that impact on our environment. Those environmental impacts must be positive.

The Malinauskas Labor government acted immediately to increase the uptake of owning an electrical vehicle by reducing the cost of owning and driving one. The former Liberal government's plan was to commence the levy on whichever came first—1 July 2027 or when battery electric vehicle sales reached 30 per cent of the total of new motor vehicle sales in South Australia.

Its implementation meant electric vehicle owners would have been charged 2¢ for every kilometre travelled in a plug-in hybrid vehicle, or 2.5¢ for every kilometre for any other electric vehicle. The levy would have been calculated by the distance travelled each year and billed as part of the vehicle registration process. The EV levy not only penalised those wanting to purchase an electric vehicle, it also made our state vulnerable to a reduction in GST.

The former Liberal government did not factor in that this levy would affect South Australia's allocation of GST funds. We know that GST allocations to states and territories are balanced against their own revenue-raising capacity in the population that they serve. It is also great news that the Albanese federal Labor government removed the fringe benefits tax (FBT) and the 5 per cent import tariff for eligible electric vehicles. This makes EVs much more appealing; for example, it means that an employer who purchases an electric vehicle for a cost of, say, $50,000 will save around $4,700 a year due to the removal of FBT.

The South Australian Labor government will be contributing to the Albanese government's EV strategy, which is essentially an option plan to achieve some very positive outcomes for electric vehicles, such as a reduction of emissions, savings on fuel costs, ensuring we take advantage of local manufacturing opportunities, making electric vehicles more affordable, creating opportunities for more choice in the market, and encouraging people to invest in an electric vehicle. There will be many South Australians who will say that the cost of a new electrical vehicle is beyond their budget; however, the more EVs South Australians own, the more affordable they will become.

Members will remember that it was Labor that electrified our train lines to the south when we were last in government. We also initiated the electrification of the northern line to Gawler before this was completed by the former Liberal government. We know the benefits of electric vehicles and we know that we need to invest and install the necessary infrastructure to support them. This Labor government is supporting the RAA to construct the state's first electric vehicle charging network of 500 charging stations at 140 sites in 52 locations across South Australia. This is supported by the state government with a grant of almost $12.4 million.

Access to charging stations will drive the uptake of electric vehicles. Locally, the Malinauskas government is supporting 7,000 electric vehicle purchases with subsidies of $3,000 and a three-year registration fee exemption. The momentum to encourage EV ownership is so important. Incentives are needed to inspire interest in driving an electric vehicle. This is why the Liberals' tax on EVs must be scrapped. Unlike the former Liberal government, this Labor government is demonstrating that this state has a government that is listening and developing policies that are committed to sustainable developments. I am proud to support this bill.

The Hon. J.E. HANSON (16:22): It has been a bit of a flat debate, very unfortunately, much like the former government's approach to electric vehicles generally. Obviously, I am here to rise in support of the Motor Vehicles (Electric Vehicle Levy) Amendment Repeal Bill 2022. That actually has some pretty big significance to it because, critical to this bill of course, is repealing something. What are we repealing? Let's get into that. We are repealing a tax.

How galling it must be for members on the opposition bench now that they had to come into a government promising everything that they believe in, which I honestly do think they believe in, which is less tax. The Liberal Party love telling you this. They love telling you, 'We will come in and we will cut taxes. We will make things more efficient.' What did they do? They said, 'We do not like electric vehicles, so we are going to tax them.' It was not any old tax; it was a brand-new tax.

The Hon. N.J. Centofanti: The rest of the nation is doing it.

The Hon. J.E. HANSON: The fact is, as the Hon. Ms Centofanti has just said, the rest of the nation is doing it. So now Liberal Party policy would be that we should just do what the rest of the nation is doing. I look forward to your debate on other issues this week. In doing so, in supporting this bill, I cement—which is really actually quite a bad word to use, I think, in context to this debate. I think a better one would be I look to charge up, perhaps I look to plug in, I look to accelerate the support that the Labor Party has long shown towards not just electric vehicles but vehicle manufacture in this nation. Let us remember this is the party that not only said we are going to bring in a brand-new tax to stop vehicles coming into place but they are also the party that said we are going to tell manufacturing of cars in this nation that they should leave.

The Hon. R.A. Simms: Don't forget Tony Abbott.

The Hon. J.E. HANSON: That is right; Tony Abbott, exactly. Thank you, the Hon. Mr Simms. None of us will forget that day when the Liberal federal government stood up and said, 'Car manufacturing does not belong in this nation. You should leave.' Was that not devastating for South Australia? You bet it was, and we will never let you forget that, but that is not all. Let us also remember at the last election the Liberal Party could not quite make up its mind on whether it liked electric vehicles or if it preferred cars.

We used to have a pretty big car race—that is right, we still do have a pretty big car race that this government brought back, and we brought it back because it was overwhelmingly supported by this state and visitors to this state. I remember there was a little yellow leaflet that got put out by the Liberal Party in and around Adelaide where they said, 'Don't bring back the car race.' There was an exhaust pipe and there were fumes coming out of it, and they said, 'Oh, this is going to be terrible.' Think of all the fumes that will be coming out and filling the lungs of those eastern suburbs residents that they love protecting so much—it did not do too well in the Bragg by-election, by the way—but the reality is they could not quite make up their mind.

Do they want to tax electric vehicles, or do they want to knock off car races? I think sometimes they get ideologically confused about these things. It is galling to be standing here and having to lecture the Liberal Party on the market, having to lecture the Liberal Party on choice. These are things that are meant to be fundamental. This is meant to sit right next to the valve in your heart in the Liberal Party and—

The Hon. R.A. Simms: The valve?

The Hon. J.E. HANSON: I know. Thank you, the Hon. Mr Simms. It is nice to know people listen.

The Hon. R.A. Simms: Put the brake on the puns.

The Hon. J.E. HANSON: We are here to repeal. We are here to junk the Motor Vehicles (Electric Vehicle Levy) Amendment Act brought in by the former Liberal government, which would have taxed electric vehicle users on a distance-based charge of 2¢ per kilometre for hybrid vehicles and 2.5¢ a kilometre for all other electric vehicles. Sorry to have to pick up my notes and read that out because this can sound a little complex, but it is actually really simple.

Let us be clear. This was not a substitute for paying the fuel excise, which is a federal tax: it was a 100 per cent shiny, new, straight out of the car lot, brand-new tax, and the Liberal Party brought it to you—how galling. I can see right now that they cannot even look up at me on the opposition benches, and I do not blame them.

The Hon. N.J. Centofanti: Sorry we are not hanging off your every word.

The Hon. J.E. HANSON: I am sorry you are not hanging off my every word, too, because that is why you are over there and I am over here.

An honourable member: The arrogance.

The Hon. J.E. HANSON: Labor opposed this tax. It is not arrogance, it is reality; I am here, you are there. Labor opposed this tax, and it is really one of those things where you are happy to achieve things when you get into government. You said it in opposition and then you do it in government. That is the kind of thing that people want to see in modern politics. To take the cut and thrust of this place out of it, it is true. When you go out in normal society and you talk to people—for instance, where I live people talk about electric vehicles. They talk about the repeal of this bill and they talk about it in a way that changed their vote.

They used to vote Liberal, and they decided to change their vote on the strength of this. We are now fulfilling our election promise to repeal it. We are fulfilling our promise to those people. Labor will not stand by as the rest of the world enjoys more affordable, more accessible electric vehicles and as Australia lags behind with high-polluting cars. Australia is miles behind other economically advanced countries, and this is something that the state and federal Labor governments are very keen to resolve not just for the social or environmental consequences that are very close to the Hon. Mr Simms' heart, I am sure, but the economic ones, too.

The Australia Institute surveyed South Australians in 2021, and it found that seven in 10 would be less likely to purchase an electric vehicle if a new road user charge were to be introduced—seven in 10, 70 per cent. I mean, imagine that. Imagine actually standing against that.

The Hon. F. Pangallo: Because nobody wants to pay tax—that's why.

The Hon. J.E. HANSON: Nobody wants to pay tax, the Hon. Mr Pangallo says, and there is probably some truth to that, but people do not just want to avoid tax. I have never found that to be the case. What I have found to be the case, the Hon. Mr Pangallo, is they do not want to pay a tax that they see no point in there being in place. They did not see a point in the electric vehicle tax because they think that it is against the market. They think it is against what the market wants.

I look overseas. I see people buying more and more and more electric vehicles. I look here, where we used to make cars in this nation. We used to make cars in this state. We used to employ hundreds of people doing that. We could make them for an overseas market. We could make them for a domestic market, but we are only going to achieve that if we do not pay needless taxes we do not have to pay. That is where society is at. That is what they want. Indeed, that is what they voted for at the last election—again, why I am here and the opposition is over there.

As our state has declared a climate emergency—and passenger cars make up almost 10 per cent of Australia's carbon emissions—this is not the time that we should be putting a handbrake on sustainable investment. UBS Global has estimated that consumers will save approximately $1,700 by 2030 on the cost of owning and operating electric vehicles over petrol combustion engines.

When we are talking about a cost-of-living crisis in this nation—and we do have one: for a long time, unfortunately, the industrial relations policies of the Liberal Party have delivered lower wages and now we live in this lower wage world where people are struggling to own houses and struggling to own cars—$1,700 by 2030 on the cost of owning and operating electric vehicles over petrol combustion engines is big bickies. That could make the real difference between getting your kids to school or going on that holiday you might like to go on in regional South Australia.

The Liberals' tax was a backwards approach. It was one that was looking backwards, where we cannot reside any more. We have to be looking forwards. It is an approach that disadvantaged South Australians and disadvantaged them so greatly that they saw no point in having it and they changed government.

By repealing this levy within our first year of government—and again I go back to: it is our first year of government. I know it feels like it has been a long time. It does. We have done so much. Wait until my matter of interest this week, Mr Simms, it is going to be fabulous. We are providing certainty for prospective buyers in our community and reducing the cost of purchasing and operating electric vehicles. That is bringing down that cost of living, which is very much front of mind for so many South Australians.

The SA government is also providing 7,000 subsidies of $3,000 and three years' registration fee exemptions to provide further incentives for consumers. We are also supporting the RAA's construction of the state's first electric vehicle charging network, with over 5,000 charging stations across the metropolitan and regional areas.

I know that is something that is very close to a lot of people who have spoken to me about this issue. They have said, 'Look, I'm a bit worried about getting an electric vehicle because I'm not certain I will be able to charge it everywhere I go.' Well, 5,000 charging stations across the metropolitan and regional areas.

I think other members have already gone to it, but I just want to underline the point. The state government is—I think it would have to be—the largest employer in this state. There are 6,500 vehicles, probably a few more than that, in the SA government fleet, travelling about 110 million kilometres annually. Thank you to my staff for that statistic; I am not sure where they got it from but, gee, that is a good one. It is 110 million kilometres annually. This equates to 21,000 tonnes of CO2 emissions, and the state government is requiring agencies to transition to electric vehicles if, indeed, it is cost-effective for them to do so.

That will also significantly lower our state's carbon footprint and will also provide a second-hand electric vehicle market in the very long-term. I know that before I came to this place, I loved buying ex-government vehicles. You would duck down to the car auctions and get yourself a car down there. You can get a real bargain, for anyone who is an avid reader of Hansard; I know there are so many. They will be fleeing down there this week to go and see if they can get themselves an electric vehicle, but they might have to wait a while thanks to the Liberal Party.

As I mentioned, the federal Albanese Labor government is also doing its part and is going to encourage the ownership of electric vehicles, too. It has committed to establishing a national EV charging network. It is aimed at having 75 per cent of the commonwealth fleet being EVs by 2025—which is not that long away—and removing the fringe benefits tax for electric vehicles. These are great steps forward. Again, here we are lecturing the Liberal Party on how the market actually works and how choice actually works.

This would mean if you had a $50,000 EV—it would be a bit hard to find at the moment, but if you had a $50,000 EV it would make the maths pretty easy—it would be up to $4,700 cheaper each year and employers could save up to $9,000 a year. Together, the Malinauskas and Albanese Labor governments are fixing this mess that is currently the market created by our former state and federal Liberal governments.

The Hon. D.G.E. Hood: You are intervening in the market all the time, which is making a mess of it.

The Hon. J.E. HANSON: Thank you, the Hon. Mr Hood. I was actually hoping for that interjection. By providing incentives to the market, that is regarded as intervention. What this is doing is adjusting the fleet to reduce emissions. That would be actually adapting yourself to a market, something which we should all do.

The Hon. N.J. Centofanti: 'Adapting' is a new word.

The Hon. J.E. HANSON: It is adapting, the Hon. Ms Centofanti, and also by saying we are going to look at cutting fringe benefits tax. I do not know too many Liberal voters who have ever come to me and said, 'You know what I love paying at the end of the year? I love paying fringe benefits tax.'

The Hon. D.G.E. Hood: Any subsidies for those charging stations?

The Hon. J.E. HANSON: I do not know, the Hon. Mr Hood, but maybe I could take that on notice and bring that back as a matter of interest. I know you would love to hear it when I do. The non-existence of investment by the federal Coalition government has left Australia with just eight low-emission vehicle options. I go back to struggling to find that $50,000 EV.

We have only eight low-emission vehicle options under $60,000. I know when I talk to people about EVs, the cost of EVs is really a key factor. This is going to adjust that. If you want to look overseas at how that could be so easily adjusted in comparison, consumers in the United Kingdom, for instance, have 26 vehicle options under that financial threshold—26 versus our eight.

As you can see over time, if you remove these barriers, the market develops. If you have 26 options, that means 26 varieties need to be created. That is going to drive more jobs. If we start to bring those jobs back to Australia or indeed South Australia, hopefully, to start making those options, to start creating them, that is going to drive more jobs in manufacturing in this state.

I know that is something the Hon. Mr Hood and I have spoken about many times. I know it is something he would like to see. He has a family history of that. I think, were he in that federal government back in the day, things might have been very different. The Malinauskas Labor government encourages investment in modern technology. It encourages manufacturing. It encourages innovation and sustainable practices and, to do so, this is a great step forward.

This is repealing the Liberals' tax—their brand-new shiny tax on electric vehicles—and, in doing that, I think we deliver on that promise that we made at the last election. To do things in government within the first year that you promised to do in opposition I think is commendable, and I proudly support this bill.

The Hon. E.S. BOURKE (16:38): It is hard to follow that amazing enthusiasm by the honourable member, but I do rise to speak in support of the Motor Vehicle (Electric Vehicle Levy) Amendment Repeal Bill. This bill repeals legislation introduced by the former Marshall Liberal government which imposed a levy on electric vehicles. It delivers on the election commitment made by the Malinauskas Labor government. The levy would have seen electric vehicle owners charged 2¢ for every kilometre they travelled in a plug-in hybrid vehicle—I think the Hon. Justin Hanson figured out how many kilometres that worked out to be—or 2.5¢ for every kilometre they travelled in any other electric vehicle from 2027.

The former Marshall Liberal government estimated that the levy would raise $1 million, though it is not clear how that was calculated or what effect the levy would have had on GST allocation. The Malinauskas Labor government has always been clear that it does not support a new tax on South Australians who are making an environmentally conscious choice to purchase an electric vehicle or the deterrent effect that this tax would have had on South Australians who were considering purchasing an electric vehicle. It just does not make sense at an economic level or an environmental level.

Part of the incentive for electric vehicle ownership is the financial savings. It is estimated that by 2030, electric vehicle owners will save $1,700 per year compared to owners of internal combustion engine vehicles due to the lower maintenance and fuel costs. Research undertaken by the Australia Institute indicates that 70 per cent of South Australians would be less likely to purchase an electric vehicle if a new levy were introduced—that is 70 per cent fewer people.

We recently declared a climate emergency in South Australia. We know there is a need to take steps to reduce our climate emissions. Currently, internal combustion engine passenger vehicles contribute almost 10 per cent of all CO2 emissions in Australia. An uptake in electric vehicles will have a direct impact, reducing our carbon emissions. Now is the time to be encouraging the purchase of electric vehicles, not discouraging it. South Australians looking to buy a new car need certainty, and we should be supporting industries that are pouring money and research into cleaner and greener transport options.

To that end, our federal counterparts in the Albanese Labor government released the Driving the Nation plan, which, I am advised, includes several important electric vehicle policies. They will establish a national EV charging network on our major roads across the country. I have also been advised they will create a national hydrogen highways refuelling network. They have set a low-emissions vehicle target for the commonwealth car fleet of 75 per cent by 2025, and they have recently released a discussion paper for the purpose of developing strategies to encourage the uptake of electric vehicles.

Federal Labor has also already introduced a range of other incentives. It has removed the fringe benefits tax and import tariff for eligible electric vehicles, saving both the employees and employers thousands of dollars, a saving that is critical for fleet buyers and that will also increase the second-hand market. It has also announced Australia's first National Electric Vehicle Strategy, which has the following goals: make electric vehicles more affordable, increase choice in the market, increase uptake of electric vehicles, reduce emissions, reduce cost-of-living pressures by reducing expenditure on fuel, make the most of local manufacturing opportunities and potentially introduce fuel efficiency standards.

The South Australian government has been invited to be involved in developing the strategy. We strongly support a federally led approach to complement the state-based initiatives. We need to show leadership in this space because if we do not we will lag behind internationally. We do not want to get stuck with the old technology and no resale value, which is of no benefit to our local economy.

It is clear that the tides are turning in favour of electric vehicles, and it is past time for South Australia to get on board. The Advertiser recently called the growing popularity of electric vehicles 'a shift in focus' in our car industry, while the Chief Executive of the Electric Vehicle Council said the shift to EV is obvious. This comes as three out of eight finalist cars in News Corp's 25th annual Car of the Year Awards are electric: the Tesla Model Y, the Kia EV6 and the BYD Atto 3. Another is a hybrid, the Toyota Corolla Cross—for all you car fans out there. That is why we have a range of initiatives to support the uptake of electric vehicles in South Australia.

There are initiatives in many countries across the globe to encourage the purchase of electric vehicles including Austria, Canada, China, Denmark, France, Germany, Greece, India, Ireland, Italy, Japan, Luxembourg—I could keep naming the many that are here—United Kingdom, United States, Spain and many, many more. They have all introduced incentives and they have proved successful at increasing the uptake of electric vehicles.

These initiatives include tax reductions and exemptions and subsidies. These initiatives make sense because we know that the current barriers to electric vehicle ownership in South Australia are the low number of electric vehicles available on the market—if you look on carsales, you will see only 50 used electric cars for sale out of the total of 10,026 used car sales in South Australia, but I am guessing it was last year when this speech was written—higher upfront purchase costs—for example, in the UK there are 26 low emission vehicles under $60,000 and in Australia there are only eight—and consumer uncertainty about range, performance and access to charging infrastructure, which obviously rates highly.

With that in mind, the Malinauskas government has committed to funding 7,000 subsidies for electric vehicles purchases, worth $3,000 each. I am also advised that we are doing a three-year registration fee exemption for electric vehicles, supporting the RAA to construct the state's first ever electric charging network, which will include over 140 charging sites with over 500 charging stations throughout South Australia, and conducting electric vehicle smart-charging trials to progress the integration of electric vehicles into the grid. I am most excited about the rollout of the electric vehicle charging network, which will respond to increased demand as more people start driving electric vehicles.

The South Australian government has awarded a grant of almost $12.4 million to the RAA to construct this statewide network, which will see charging stations in metropolitan, regional and rural locations throughout the state, in particular to ensure that travellers heading to towns like Renmark, Ceduna, Coober Pedy, Kingscote or Mount Gambier and across our state's borders in electric vehicles have peace of mind.

It is important that people can access infrastructure for affordable charging at a range of locations across South Australia and we are not wasting any time. The network is expected to be in place by the end of 2023. In the meantime, we are also getting on with the smart-charging trials, which will see smart-charging stations established across frequently visited sites, such as supermarkets, shopping centres, hotels, motels, off-street car parks and holiday parks throughout South Australia.

The state government has committed $3.2 million in grant funding, which will fund 142 new rapid charging bays for South Australian motorists and has attracted $4.8 million of private investment for development and construction. This will also provide an opportunity for data collection on when and how often people use the chargers to inform our state's future investment and planning.

These new rapid charge bays will be located in areas such as the CBD at Wilson car parks, the UPark Topham Mall, Port Adelaide Plaza, public areas in the City of Charles Sturt and the City of Port Adelaide Enfield, some businesses and public areas in the City of Marion, on certain Uniting Communities sites within their facilities, the NRMA Victor Harbor Beachfront Holiday Park, in 22 car parks at Flinders University and at Foodland Pasadena.

We have also committed as a state government to electrifying our vehicle fleet. There are 6,500 vehicles, which travel a total of around 110 million kilometres. This equates to emissions of 21,000 tonnes of carbon dioxide. State government agencies are required to transition to plug-in electric vehicles if they are cost effective on a total cost of ownership basis or if the additional costs can be managed by improving fleet utilisation.

The orderly transition of our government fleet to electric vehicles will mean that we are contributing to lowering our state's emissions and increasing the number of vehicles in the second-hand market, which will reduce the upfront cost for purchasers. This government is taking decisive and ambitious actions on climate industry, jobs and cost-of-living pressures, not just through incentivising the uptake of electric vehicles but through other measures.

The centrepiece of this agenda is of course our Hydrogen Jobs Plan, which will see the construction of a world-leading hydrogen power station, electrolysers and a storage facility. I support this bill as an important component of the government's climate industry and cost-of-living policies, and I look forward to seeing more electric vehicles on our roads.

The Hon. C.M. SCRIVEN (Minister for Primary Industries and Regional Development, Minister for Forest Industries) (16:50): I thank all members who have made contributions. The abolition of the controversial EV levy was a key election commitment of the then Malinauskas Labor opposition. It is important that we remove barriers to the adoption of electric vehicles, not impose new taxes that serve to disincentivise EV adoption.

Energy efficiency is crucial to improving productivity across the economy, which in turn underpins wage growth and improvements in the way we live. Burning fossil fuels to run inefficient vehicles, which could instead be powered, for example, by energy from a consumer's solar panels at home, is not the best use of these scarce resources. This is an economic consideration, which adds to the considerable environmental advantages of EVs.

The greater energy efficiency of an electric vehicle underpins their simpler construction. There is no need for radiators and cooling systems, exhausts and so on. An electric vehicle has literally thousands fewer parts than an internal combustion engine vehicle. In turn, this means that an EV requires less maintenance, far less maintenance, which is a key reason why the operating costs of running an EV are far lower than a petrol or diesel car. It is not just that electricity, especially from a consumer's own solar power, is far cheaper per kilometre, it is also about lower maintenance costs.

Of course we all know that at the moment economies of scale for EVs are not as significant as they are for petrol vehicles, which means that there are higher up-front initial costs, but the lifetime costs are lower. That is why EVs are increasingly becoming the preferred choice for businesses running fleets, in addition to the benefits of a business being in sync with a community demand for more action on climate change.

The EV levy is a particularly nasty impost on consumers. A family sitting around their kitchen table considering their next vehicle will look at both the initial capital cost but also the ongoing operating costs. The lower operating cost should be a factor that acts as a positive, but instead the Liberals wanted to put lead in the saddlebags, dissuading consumers from making an investment choice that would actually be better for them overall. It was an awful decision.

The levy is a blunt instrument. It gives no avenue for a more sophisticated approach to how motorists should pay for road usage. The Australian Automobile Association (AAA), the umbrella body for state-based organisations, including our RAA, put out a discussion paper on the need for a replacement for fuel excise. The AAA said that reform should be initiated by the commonwealth, not the states, and they said it should be sophisticated, taking into consideration issues such as congestion and differences between city and regional road use. The Liberal Party's new tax did none of that. It failed on so many fronts.

In the Labor Party, we do not put roadblocks in the way of the public when they want to make investment choices. That is why it was so important to immediately act to repeal this and to scrap the levy. I commend the bill to the chamber.

Bill read a second time.

Committee Stage

In committee.

Clause 1.

The Hon. N.J. CENTOFANTI: Minister, what will be Labor's alternative sustainable long-term road funding model that will replace the one established under the EV levy act?

The Hon. C.M. SCRIVEN: Firstly, I think it is important to point out that fuel excise is a commonwealth government charge. As this is a national matter, the commonwealth government should determine how to mitigate the impact of the reduction of the fuel excise. Also, a preferred approach has been to have a nationally-consistent approach for taxation. The South Australian government is open to participating in a conversation led by the commonwealth government.

It is also worth noting that, regardless of the adoption of electric vehicles, fuel excise will reduce with more fuel-efficient vehicles. The proposed tax that the Liberals introduced did nothing to recover higher fuel excise from higher fuel-efficient vehicles. The South Australian government receives road funding from the commonwealth government, and the Malinauskas Labor government will continue to advocate for our fair share going forward. It really does come back to the role being that of the commonwealth government, and the states of course, particularly ours, will be advocating accordingly.

The Hon. N.J. CENTOFANTI: Is the minister suggesting that there will be a commonwealth levy in the future for EVs?

The Hon. C.M. SCRIVEN: To answer the question, I bring to the attention of the chamber that a commonwealth strategy is being developed and the states are participating and South Australia will certainly be a very active participant in the discussions around that strategy. I have not heard anything to suggest that the commonwealth plans to introduce a charge, but of course that is within the scope of the commonwealth government and is not something we can particularly have reference to here.

The Hon. N.J. CENTOFANTI: So can the minister rule out a commonwealth levy on EVs in the future?

The Hon. I.K. Hunter interjecting:

The Hon. N.J. CENTOFANTI: I am just asking.

The Hon. C.M. SCRIVEN: I think the commonwealth government would be best placed to answer such a question.

The Hon. I.K. Hunter: It's the stupidest question in the world. She's a state minister. She can't rule out anything by the federal government.

The CHAIR: The Hon. Mr Hunter, would you like to get on your feet if you are going to make a comment.

The Hon. F. PANGALLO: Can the minister rule out that there will not be a tax imposed on electric—

The Hon. C.M. Scriven: You have a double-negative there. It is just a little bit confusing.

The Hon. F. PANGALLO: A double-negative. We are talking about electric vehicles, so negative ions and stuff like that. Can the Malinauskas government rule out introducing a form of tax on electric vehicles in this term of government and perhaps even the next term of government, if it is elected? Can you guarantee that there will not be a fuel tax imposed, either through this term of government, even though you are repealing this tax, or any following terms, should you be elected?

The Hon. C.M. SCRIVEN: I thank the honourable member for his question. Whilst in opposition the then Malinauskas Labor opposition committed to no new taxes in this term. We stand by that commitment. I think the fact that we are repealing this legislation, this tax, speaks volumes for what our intentions are, which is to encourage the uptake of electric vehicles and to encourage that both on environmental and economic grounds.

The Hon. N.J. Centofanti: It doesn't matter who introduces a tax—a tax is a tax.

The CHAIR: Order!

The Hon. F. PANGALLO: Can the minister—

The Hon. N.J. Centofanti interjecting:

The CHAIR: Order!

The Hon. F. PANGALLO: Can the minister tell me which countries do have a tax on electric vehicles and those that do not?

The Hon. C.M. SCRIVEN: That information is not available here, but we can take that on notice.

The Hon. F. PANGALLO: Will the government make any representations to the federal government in relation to current fuel standards being changed, which, apparently, according to the motor industry and experts who know, is also proving to be a setback for having more EV models in Australia?

The Hon. C.M. SCRIVEN: I am advised that is being considered by the National EV Strategy and those looking at that.

The Hon. F. PANGALLO: What will the Treasurer do to fill the void that is likely to be created when other states also adopt a tax? What are the Treasurer's plans to fill the void of not getting funding for the maintenance of roads in South Australia when there is no tax on battery electric vehicles (BEVs) and PHEVs?

The Hon. C.M. SCRIVEN: I am advised that there was no revenue in the forward estimates from this tax because the implementation date was due to be from 2027. We do get revenue from registrations of electric vehicles.

The Hon. N.J. CENTOFANTI: How will the government's decision to repeal this levy impact the future distribution of fuel excise from the Australian government to South Australia?

The Hon. C.M. SCRIVEN: I am advised that fuel excise is a commonwealth excise. It is not directly hypothecated to the states and therefore the decisions that it makes are entirely within the remit of the commonwealth government.

The Hon. N.J. CENTOFANTI: How will future state governments maintain safe roads without the cost falling on those who cannot afford electric vehicles?

The Hon. C.M. SCRIVEN: Where we currently maintain roads, we do not charge on electric vehicles at present. I think that is kind of self-explanatory.

The Hon. F. PANGALLO: What other incentives does the Malinauskas government plan to bring in to encourage a higher uptake of BEVs and PHEVs?

The Hon. C.M. SCRIVEN: Currently, as was mentioned through some of the second reading contributions, there is a $3,000 subsidy and a three-year registration exemption for eligible new battery electric and hydrogen fuel cell vehicles. Whilst it is not obviously within the scope of the state, it is worth mentioning the commonwealth announcement of a fringe benefits tax exemption. The state government is also helping to remove other barriers to take up electric vehicles, including lessening range anxiety through the provision of charging infrastructure with a $12.4 million grant to the RAA to construct and operate the state's first electric vehicle charging network.

The South Australian government is also investing $3.2 million in EV smart-charging trials that bring forward public demonstrations of consumer-focused smart-charging solutions. These are trials that I think were mentioned by my colleague the Hon. Ms Bourke, occurring at sites such as Pasadena shopping centre, Victor Harbor Beachfront Holiday Park and Flinders University.

The Hon. F. PANGALLO: I just want to make it clear that I am not an opponent of electric vehicles. In fact, I would be a strong supporter of them, but why is the government on the wrong route when it comes to—

An honourable member interjecting:

The Hon. F. PANGALLO: We are getting a lot of ideological wheel spin here because it seems to be opposed to what is happening in a Labor-dominated Victorian state. Why is the South Australian government taking a different route in relation to road user charges for EVs compared with many European countries, Scandinavian countries, the UK, New Zealand, Singapore, Canada, and I believe about 18 states in the United States now? Why is South Australia going against the direction that other countries are taking, realising that a road user charge is going to be necessary as more of these vehicles are on the roads?

The Hon. C.M. SCRIVEN: It is important that we look at different alternatives and options. It is also worth reflecting on some comments I made in my contribution. The Australian Automobile Association said reform should be initiated by the commonwealth and not by the states and also that it should be sophisticated, should take into considerations issues such as congestion and differences between city and regional road use, for example.

The tax that the Liberal Party introduced through this levy did none of that. It was a very blunt instrument. It has not been appropriate. It is not going to actually solve any of the issues that are being raised as potential problems or concerns, so it is appropriate to repeal the act and remove this Liberal Party tax.

The Hon. F. PANGALLO: Can I ask this question of the minister: which vehicle does she think would cause more damage to a road surface, a Tesla S3 or a Hyundai Elantra? Which vehicle does she think could cause more damage to a road surface?

The Hon. C.M. SCRIVEN: I am advised that road damage is normally most affected by the weight of a vehicle, but what I think in terms of different vehicles is not perhaps particularly relevant to the debate at hand, which is about whether we repeal this tax or not.

The Hon. F. PANGALLO: As the minister raised the issue of weight, does she know what the weight of a Tesla S3 is compared with a Hyundai Elantra, what the difference is? Does she know what the difference in the weight is?

The Hon. C.M. SCRIVEN: No.

The Hon. F. PANGALLO: The Tesla weighs almost a tonne more than the Hyundai, so it is more likely to probably cause more damage on the road surface. In saying that, again, as I said, it is not that I am an opponent of EVs, but where is the money going to come from when you have so many cars on the road and the people still driving petrol engines are still paying the fuel excise tax? Most of those people will be those in places where they would not be able to afford to buy an electric vehicle.

The Hon. C.M. SCRIVEN: I thank the honourable member for his question. First of all, in regard to the first questions or comments that were made, we need to be looking at the fact that vehicles are changing over time. If we had been having a discussion about vehicles 10 years ago or 20 years ago, it would have been very different to the discussions we are having today. So I think it is just worth making sure that the decisions we are making are not bogged down in what we envisage here and now as the only options.

Secondly, fuel excise will continue to decrease as we have more fuel-efficient vehicles. As I made the point earlier, this tax, which is the subject of this bill—its removal—did nothing to address that as an issue. Thirdly, the commonwealth strategy will be encompassing many of these queries and questions. As I have mentioned before, there is certainly strong merit to there being a commonwealth-led initiative in terms of these sorts of reforms rather than individual states.

The Hon. N.J. CENTOFANTI: Is the minister aware of whether the commonwealth government is considering a national road user levy for EVs as part of this commonwealth strategy?

The Hon. C.M. SCRIVEN: That is a question best directed to the commonwealth government.

Clause passed.

Remaining clause (2) and titled passed.

Bill reported without amendment.

Third Reading

The Hon. C.M. SCRIVEN (Minister for Primary Industries and Regional Development, Minister for Forest Industries) (17:11): I move:

That this bill be now read a third time.

Bill read a third time and passed.

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