Confirmed: NSW to scrap electric-car purchase incentives, but increase funding for charging infrastructure

Following the lead set by Victoria, the NSW government is set to scrap purchase incentives for new electric vehicles from January 2024, but will use some of the allocated funding to install more charging stations.

New South Wales has become the second Australian state to scrap its rebates for the purchase of new electric cars, it has confirmed today.

As reported byThe Sydney Morning Herald, the NSW goverment has announced in the lead-up to the 2024 state budget it plans to axe the $3000 electric-car purchase rebate – and free stamp duty – on eligible vehicles from 1 January 2024.

The NSW electric-vehicle incentive scheme commenced on 1 September 2021, and offered a $3000 incentive – plus free stamp duty – to buyers of the first 25,000 electric cars sold with a ‘dutiable value’ of less than $68,750.

Approximately one-third of the proposed incentives (8391 cars) had been claimed as of 31 August 2023 – amounting to $25.1 million of the $75 million allocated to the program.

NSW Premier Chris Minns claimed last month the government’s $3000 subsidy is “pushing up the costs of EVs [electric vehicles],” as car companies are reportedly increasing prices to maximise profit from the in-demand vehicles.

It follows Victoria’s decision to scrap its electric-car incentive scheme on 30 June 2023, with a claim that over 10,000 new electric car buyers benefitted from the program.

According to the SMH, the NSW government plans to scrap both the incentive scheme and complimentary stamp duty for electric vehicles – with a projected saving of $527 million – in the forthcoming state budget.

However it instead intends to funnel up to $260 million toward electric-vehicle charging infrastructure in New South Wales regional areas, as well as for drivers who do not have easy access to off-street parking.

With now approximately 125,000 electric and plug-in hybrid cars now on Australian roads, an emphasis on infrastructure support to allow faster and more prevalent charging options for all electric-vehicle drivers is seen by NSW Minister for Energy and Climate Change Penny Sharpe, to be a more broad-ranging investment of public funds.

“To facilitate EV uptake, the NSW government will increase funding to essential infrastructure,” Ms Sharpe said in a media statement.

There are now approximately 20 different electric-car models priced below the $68,750 rebate cutoff, with three models priced below $40,000 before on-road costs.

The SMH report notes that buyers who have already ordered a car and are expecting to benefit from the rebate scheme, will not be impacted.

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