David Pocock (ACT, Independent) Share this | Hansard source

by leave—I move:

(1) Clause 2, page 2 (after table item 2), insert:

(2) Page 5 (after line 8), at the end of the Bill, add:

Schedule 2 — Electric car discount: termination of exemption for plug-in hybrid electric vehicles

Fringe Benefits Tax Assessment Act 1986

1 Paragraph 8A(2)(b)

Omit "vehicle; or", substitute "vehicle.".

2 Paragraph 8A(2)(c)

Repeal the paragraph.

3 Subsection 8A(5)

Repeal the subsection.

4 Subsection 136(1) (definition of plug-in hybrid electric vehicle )

Repeal the definition.

5 Application of amendments

(1) The amendments of the Fringe Benefits Tax Assessment Act 1986 made by this Schedule apply to benefits provided on or after 1 April 2025.

(2) Despite subitem (1), the amendments do not apply to the application or availability of a car at a particular time (the relevant time) on or after 1 April 2025 if:

(a) the application or availability constitutes a car benefit because of subsection 7(1) of the Fringe Benefits Tax Assessment Act 1986; and

(b) before 1 April 2025, the employer, the employee, or an associate of the employer or of the employee, committed to the application or availability of the car, in respect of the employment of the employee by the employer, for a period that began before 1 April 2025 and includes the relevant time; and

(c) at no time on or after 1 April 2025 and before or at the relevant time did the employer, the employee, or an associate of the employer or of the employee, commit to the application or availability of the car, in respect of the employment of the employee by the employer, for a period that includes the relevant time; and

(d) before 1 April 2025 a car benefit relating to the car was provided; and

(e) the car benefit referred to in paragraph (d) of this subitem was an exempt benefit in relation to a year of tax because of section 8A (Exempt car benefits: zero or low emissions vehicles) of that Act.

I welcome this bill and the function it serves to create a second-hand EV market in Australia. This is much needed. Most Australians are currently priced out of the EV market. Incentivising EVs in this way for fleets will have flow-on effects to create that affordable EV market which will allow a number of people to get into it and unlock the cost savings that electric vehicles provide, both in terms of not having to fill them up with petrol at the servo but also in reducing maintenance costs.

While it's a great thing to incentivise EVs in this way, there is a concern with plug-in hybrid vehicles over the long term. The reality is that plug-in hybrid electric vehicles in fleets are not plugged in often and end up being used on the engine, which is a smaller engine, and, as has been pointed out many times, they are heavier vehicles. This drastically increases the amount of fuel that they use. This amendment will limit the problems with the plug-in hybrids. It has a sunset clause which provides certainty for fleets and people who are looking to get a vehicle. It ensures that we are moving towards the more efficient and newer technology of battery electric vehicles.

I thank the government and the Greens for the way in which they have approached this issue to reach this outcome.