Opinion: Pull the plug on electric-car tax breaks, rebates, and other cash incentives

opinion:-pull-the-plug-on-electric-car-tax-breaks,-rebates,-and-other-cash-incentives

Joshua Dowling

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It’s time for Australian governments to pull the plug on electric-car incentives such as tax breaks, rebates, stamp duty waivers and other financial stimulus – even though such programs have only just begun.

Demand for electric vehicles in Australia is at record highs and car companies can’t build them fast enough: partly because they require three times as many semiconductors as a petrol or diesel car, and partly because Australians are finally starting to embrace the technology.

Unfortunately, just as it takes forever for governments to introduce such incentives, there is a growing concern they may take even longer to switch off.



Tesla – the largest seller of electric cars globally and in Australia – has waiting lists that stretch into next year.

Affordable brands such as Hyundai and Kia have electric-car waiting times that stretch from 12 months to more than two years.

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Government incentives were created to help boost consumer demand for the new technology. We now have that demand. We now better understand the technology. So it’s time to take these cash incentives away.



Although there are limits on which tax incentives apply to electric cars in Australia – typically up to about $65,000 – this price threshold is still way out of reach for most new-car buyers.  

The average price paid for all new motor vehicles in Australia is about $35,000. The cheapest electric car is about $45,000, and the most popular models cost in excess of $65,000.

Meantime, taxpayer funds are being used to help people who are financially comfortable enough to be able to afford such an expensive car – up to $65,000 – while Australians living on struggle street are driving older, thirstier, and less safe cars that cost more to run.



It’s an inequity that needs to be addressed. Based on my experience, quite a number of electric-car buyers – and vocal advocates – consider themselves to be “of the people”. 

They also might be considered by others as “virtue signallers” and “social justice warriors”. I can think of another word: “hypocrites”.

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If electric-car buyers truly did care about others – especially those less fortunate – they wouldn’t pocket the generous tax rebates, stamp duty waivers, and other cash incentives.



Indeed, just last week, a friend who owns a Tesla Model 3 sold his car with less than 1000km on the clock, having owned it barely a few months.

He pocketed the $5000 tax incentive on offer in his state, plus sold the car for significantly more than what he paid for it. In total, he trousered more than $10,000 in profit. At least half of it came from taxpayers like you and me.

Spotting an opportunity, he has signed up for another electric car. And will pocket another $5000 from the taxpayer for his trouble.



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This madness needs to stop. If electric-car drivers really do care about other people – and the planet – more than the rest of us (as they think they do), it’s time for them to come clean with their conscience.

Governments should switch from providing generous tax incentives to buyers of electric cars – who clearly can afford such an expensive vehicle anyway – and instead put that money towards infrastructure which could eventually benefit everyone.

Or, you know, come up with a workable cash-for-clunkers scheme so those living close to the poverty line can get into a safer, newer, and more fuel-efficient used car. Now there’s an idea.

Joshua Dowling

Joshua Dowling has been a motoring journalist for more than 20 years, spending most of that time working for The Sydney Morning Herald (as motoring editor and one of the early members of the Drive team) and News Corp Australia. He joined CarAdvice / Drive in late 2018, and has been a World Car of the Year judge for 10 years.

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