OPINION: Electric Vehicles and ‘can-do’ capitalism
This week I took the first step towards setting up a tax-avoidance scheme. It is perfectly legal and practically foolproof. It only relies on the continued foolishness of the Federal Government – which is pretty much guaranteed these days.
The step was to put an order in for an electric car. That included a test drive along Australia’s most spectacular road: the Captain Cook Highway north of Cairns – the Coral Sea and the reef on the right and rainforest or cane fields to the left.
Wow. We will need a new word for “petrolhead”. Not that I have ever been one. I am more an A-to-B person.
In the past year we did 20,000kms in the Toyota Landcruiser, mainly towing a caravan across the top of Australia and back while everyone down south was enjoying the pleasures of winter and lockdowns.
That took about 3500 litres of fuel. The cost included 43 cents a litre in fuel tax and another 15 cents a litre in GST – a total of $2030. This is the tax that my tax-avoidance scheme is going to avoid.
According to the Prime Minister, however, there are some downsides. I will not, of course, be able to use my electric car at the weekend. Remember, he told us that electric cars will “destroy the weekend”.
This from the party that gave us Work Choices under which employers could choose to roster the casualised workforce at a moment’s notice to work weekend shifts without any penalty rates. But that is by the by.
Also, I won’t be able to tow anything, even though the manual for the small SUV Mercedes EV I have ordered says it can tow up to 1800 kilograms, and Tesla has an EV that can tow a jumbo jet.
Trust me, EV’s are very gutsy cars. Their real beauty lies in the smooth and rapid zero-to-120km/h acceleration rate. Going up and down steep winding roads is a joy. There are no gear changes with their concomitant loss of momentum. The EV grabs the road as you accelerate around corners.
Yes, the upfront cost is high – pretty much beyond the reach of anyone other than privileged semi-retired baby boomers with no mortgages and good superannuation accounts.
But never mind, unfettered “can-do capitalism” will surely bring the benefits of electric vehicles to Millennials and GenX-ers sometime in the latter half of the century. Meanwhile, they will have to keep paying their fuel tax and the GST on the fuel.
Yes, I am deliberately and smugly pointing out the blatant unfairness of this unmanaged set-up.
And Australia will continue to import $30 billion worth of fuel every year.
Why would a government bother to plan and give incentives to a cleaner, cheaper, more efficient transport system when you can just leave it to “can-do capitalism”.
Why bother even thinking about planning for future road funding when you can do nothing and let “can-do capitalism” do it for you.
Really, it is so 19th century. “Can-do capitalism” sent children down coal mines and allowed the can-do corporations to tip toxic waste into rivers.
This is not good economic management. It is really dumb, or, worse, a corrupt pandering to big donors in the fossil industries.
It is certainly against the national interest – un-Australian if you like.
It is now obvious that the Australian vehicle fleet will be almost totally electric within 10 years, if not sooner, given the way fuel prices are going and given the way the smarter developed countries are going.
Most European countries have phase-out plans for internal combustion engines. As a result, car manufacturers also have phase-out plans You won’t be able to buy a petrol or diesel car after about 2035, if not sooner.
It will be just like the uptake of digital cameras. No-one uses film these days. Indeed, most people have given up on dedicated cameras and just use their phone to take images. It happened in less than eight years.
It will not take long for enough people to buy EVs and proselytise about their fuel and tax saving for electric vehicles to take off.
A government that was a good economic manager would have a plan for all logistics – transport and communications – and develop incentives and tax systems to deal with the change that is coming.
If the fleet goes electric, there will be no fuel tax collections. Something will have to be done to replace the $12 billion a year raised through those taxes to fund roads. Can-do capitalists will not build roads for general public use.
The Henry tax review recognised this a decade and a half ago. It is a great opportunity to have a fairer, more efficient tax based on where and when the vehicle travels. It will give incentives for people not to travel at peak times.
The telematics technology is available to do this, but to be effective it needs some government direction and rules so that manufacturers know to build the telematics into the car while it is being built.
At present, only Victoria has a road-user charge for electric vehicles. It is 2.5 cents per kilometre. It is very crudely enforced with owners taking a photograph of their odometer at registration renewal time. We surely need a national plan for national road network.
Electrifying the fleet will reduce air pollution and the health problems that come with it. It will reduce emissions. It will reduce our reliance on imported fuel, which is a security risk as well as a big economic cost.
A smart government would be on to this rather than wasting energy of problems that do not exist, like this week’s kerfuffle over “threats” to freedom of religion and voter ID.
Crispin Hull is a current columnist and the former Editor of the Canberra Times.
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