The National Automotive Leasing and Salary Packaging Association (NALSPA) is asking the Australian government to extend the fringe benefits tax (FBT) exemption for plug-in hybrid vehicles (PHEVs).
This recommendation is based on a recent report from NRMA Insurance that analysed buyer attitudes towards electric vehicles (EVs) as well as key opportunities and barriers in the sector.
According to the report, 54 per cent of people said driving range is a major reason they don’t consider an EV. Furthermore, 53 per cent worry about long charging times and 52 per cent are concerned about the lack of public charging stations.
PHEVs as a Practical Solution
NALSPA chief executive Rohan Martin said that PHEVs can help ease these worries. They offer drivers lower running costs and reduced emissions while still having the reliability of a conventional engine for longer trips.
“PHEVs are the stepping stone to pure electric driving – they’re a practical solution for motorists who seek the benefits of lower running costs and lower emissions but may regularly drive longer distances or have concerns about driving range, charging times, and lack of public charging stations associated with a pure BEV,” Martin said.
“We know drivers primarily use PHEVs as electric vehicles but also have the security of a conventional engine for longer trips or when charging isn’t readily available. PHEVs also align with Australia’s preferred vehicle types. Australians love their larger dual-cabs and utes, but now and soon, a greater variety of these harder-to-fully-electrify vehicles will likely be available in PHEV form compared to BEV,” he added.
Increasing Adoption and Government Support
Martin also said that PHEVs can start their electrification journey earlier with the help of PHEVs.
“Our data shows PHEV uptake is increasing among everyday working Australians living in the outer suburbs and regional areas as these vehicles better suit their driving needs,” he said.
“Continued government support of PHEVs is necessary to help more Australians transition their lifestyle to electrified lower emissions. To support Australia in meeting its emissions targets and to keep environmentally friendly larger vehicles affordable for more Australians, we encourage our national leaders to extend the FBT exemption for PHEVs beyond April 2025,” he added.
Current FBT Exemption
Right now, potential buyers of PHEVs have until April 2025 to take advantage of the federal government’s FBT exemption scheme.
This scheme applies to both PHEVs and EVs priced under $91,387. It aims to encourage the use of low-emission vehicles by lowering costs usually linked to employer fringe benefits tax.
Despite this support, PHEVs and EVs made up only 2.5 per cent and 6.4 per cent of all new vehicle sales last month, respectively.
As interest in eco-friendly vehicles grows, NALSPA believes that ongoing support for PHEVs will be essential. This support will help Australians transition to lower-emission transportation while still meeting their practical driving needs.
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