Industry backs electrifying proposal
A proposal to give a tax break to businesses that acquire electric vehicles for staff use has found favour within the automotive industry.
Green Party transport spokeswoman Julie Anne Genter, and co-leader James Shaw, are to introduce a private members bill into parliament that will exempt electric vehicles from Fringe Benefit Tax.
Tax breaks for businesses who choose electric cars provide a major cash incentive to switch to a clean, efficient fleet, cutting the upfront cost of an electric car by up to 36%, with further savings over the life of the car, Genter says.
We’ll also give tax breaks to companies who provide their staff with public transport passes instead of free carparks.
By dramatically increasing the number of new electric cars in New Zealand, we’ll pave the way for a large second-hand market for electric cars, putting clean cars within almost everyone’s reach in just a few years, Genter explains.
Transport minister Simon Bridges has been a proponent of electric vehicle technology, but has been criticised to his hands-off, market-led approach to the issue.
It is expected he will release further incentives for the purchase of the vehicles before the end of this year.
Eric Pyle, chief executive of Drive Electric, is giving his support to the suggestion.
We welcome initiatives that are going to increase the uptake of EVs, and FBT is an option that has been discussed for some time, said Pyle.
I think it would be a signal from the government of the day that they are behind the uptake of this technology.
Pyle notes it would increase business confidence in purchasing such vehicles, but says it is only one of a broad spectrum of things that can be done.
Pyle says his organisation is working on a ‘road-map’ of initiatives that can assist, from government moves like this, through to charging infrastructure and parking. They want to see all players working together to avoid duplication of services.
While the FBT cut would save businesses money, he notes not all EV buyers are looking simply at the bottom line.
For some it will be the cost reduction, some it might be parking, others charging infrastructure, Pyle says. We need to cater to all these people and their needs.
The minister is talking about releasing a package for EVs this side of Christmas, let’s wait and see what the government comes up with.
Motor Industry Association chief executive David Crawford says his group is well behind such a policy and has told the government so.
The MIA has been on the public record that if the government wants to increase the uptake of plug-in electric vehicles, an FBT holiday is a good option, Crawford says.
Currently 70% of new vehicles are purchased by businesses, so assisting them could make a real difference.
Crawford says the premium price of plug-in options is a constraint for fleet operators, and this could make a difference.
He says indications from Treasury are that such a move is difficult as it may open the doors to others seeking tax relief.
But we have a precedent here, as theses vehicles already have an exemption from Road User Charges until 2020, he notes.
The government should seriously look at this as an option.
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