An EV charging bay in Hobart Place, Civic. Photo: James Coleman.
The ACT Government has acknowledged that its early EV incentives – which are now being phased out – were “actually pretty regressive” and “largely went to the wealthiest households”.
“To balance the budget to the best we can and get it back to a sustainable level, this is a tax concession that largely went to the wealthiest households that could afford to buy a new EV,” Minister for Finance Rachel Stephen-Smith told Budget Estimate hearings this week.
“We now have a more balanced system where we’re still providing an incentive, but we’re moving away from what was actually a pretty regressive tax concession, which was there for a reason, to bolster the EV market.
“It succeeded in doing that, and now we’re providing a lesser incentive but still an incentive to move in that direction.”
Zero-emission vehicles in the ACT have been exempt from stamp duty since August 2022, and buyers of some second-hand hybrids and plug-in hybrid electric vehicles (PHEVs) have been exempt since July 2023.
But from 1 September 2025, all new EVs in the ACT will be lumped with a 2.5 per cent duty charge, while buyers of all vehicles over $80,000 will be charged an 8 per cent rate.
This compares to the 3 to 4.5 per cent charged to all other vehicles under $45,000, and 5 to 7.8 per cent to vehicles over $45,000 (on top of a flat fee ranging from $1350 to $2038).
The Greens have accused Treasurer Chris Steel (pictured) of reneging on the government’s commitment to zero-emission vehicles. Photo: Michelle Kroll.
“We’ve now made the decision, given the state of the EV market – with a larger number of models available, and a large number of more affordable models available – that that concession is still going to be provided, but just not a 100 per cent remission of a motor vehicle duty,” Treasurer Chris Steel said.
“It’s quite a significant incentive for people to still purchase an electric vehicle.”
However, the ACT Greens have accused the government of reneging on its commitment to phase out the sale of new internal combustion engine (ICE) cars by 2030.
Greens leader Shane Rattenbury also pointed out a “bizarre outcome” in the budget, which means Canberrans are about to pay more stamp duty for used hybrids than for many new ICE cars.
The 2025 Mitsubishi Outlander PHEV is about to get more expensive. Photo: James Coleman.
The party ran the figures and found that buyers of a 2025 petrol-powered Mazda CX-5 are about to pay $100 less in stamp duty than is due on a 2023 Mitsubishi Outlander PHEV or a 2023 Toyota RAV4 Hybrid.
The ACT’s stamp duty scheme is based on emissions, with EVs in the ‘AAA’ category charged the least and high-emitting ICE cars in the ‘D’ category charged the most.
However, according to manufacturer claims, the RAV4 Hybrid emits 109 grams of CO2 per 100 km, while the Outlander PHEV emits 35 g/CO2, and the CX-5 emits 172 g/CO2.
“This change in regulation will mean that someone looking to do their bit in reducing emissions by buying a second-hand hybrid RAV4 will now pay more in stamp duty than if they were to buy a higher emissions new Mazda CX-5,” Mr Rattenbury said.
“Labor needs to explain how this happened and fix it. Canberrans shouldn’t be penalised for choosing cleaner, lower-emission vehicles and doing their bit to tackle the climate crisis. This is an opportunity for them to act.”
The ACT Greens figures on stamp duty payments. Photo: Screenshot.
Mr Steel took the question on notice and said the government would look into it.
“I suspect it’s because of a combination of factors around emissions, weight and value, but we will take that on notice and check the instrument,” he told the hearing.
The government’s move has been backed by the ACT Branch of the Australian Electric Vehicle Association (AEVA ACT), which told Region the current EV incentives “couldn’t last forever”, but criticised by the Electric Vehicle Council whose spokesperson said it “risks slamming on the brakes on the progress the ACT is making in EV uptake”.
The ACT Budget 2025-26 will be debated in the ACT Legislative Assembly during the September sitting week.
