Owning an electric car in South Australia just got a bit cheaper as new government drops road-user tax for EVs, plug-in hybrids

The recently elected South Australian (SA) government has made moves to repeal the electric vehicle (EV) user charge that was introduced by the previous state Liberal government.

During the recent state election campaign, SA Labor under Peter Malinauskas committed to abolishing the road-user charge for EVs that fell under the wider Motor Vehicles (Electric Vehicle Levy) Amendment Bill 2021.

The Marshall Liberal government that was swept from power in March this year introduced the bill that originally included a user charge calculated two cents per kilometre for plug-in hybrid (PHEV) vehicles and 2.5c/km for electric vehicles.

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Similar to schemes introduced in New South Wales and Victoria, the figure would be calculated and charged in arrears as part of the registration process in SA.

Further details of the Bill were released in November last year, including plans to push back the road user charge from July 1, 2022 to July 1, 2027, or when EV sales hit 30 per cent of total new car registrations in South Australia - whichever occurs first.

Based on an average of 15,000km travelled in a year, the EV tax would add up to $375 per annum, and PHEV owners would be up for about $300 a year.

Some elements of the original Bill designed to encourage uptake of EVs included a $3000 subsidy for the first 7000 EVs purchased costing less than $68,750, as well as a three-year exemption of registration fees for new EVs bought in SA up to and including June 30, 2025.

It looks like these elements of the Bill will remain in place.

SA minister for transport and infrastructure Tom Koutsantonis said in a release that governments should be encouraging, not prohibiting, people from buying EVs.

“We want more South Australians making more environmentally friendly choices, not putting in barriers that dissuade them,” he said.

“The feedback we received from the community was overwhelming, the Liberals’ decision to introduce this tax would have reduced community uptake.”