Extension to exemption that has been in play since 2016 announced today.

GOVERNMENT’S determination today to exempt light electric vehicles from road user charges until the end of March 2024 has been welcomed by a pressure group for battery-driven vehicles.

Electric vehicles have always been identified as being ultimately subject to RUCs and until now it was thought these would impinge relatively soon.

The extension to the exemption was announced by Transport Minister Michael Wood this morning.

A move he suggests will save EV drivers about $800 a year is designed to further encourage the uptake of such cars to help the country reduce emissions and is part of the Government’s clean-car package, which also includes six months of rebates for battery electric vehicles and plug-in hybrids before a feebate scheme kicks in at the start of 2022.

EVs have been exempt since 2016 from RUC, which normally applies to vehicles that don’t pay for petrol at the pump; diesel passenger vehicles being the highest-profile example.

Wood’s decision has been welcomed by Drive Electric, a body promoting EV usage.

Chairman Mark Gilbert says it makes good sense to extend it to support the uptake of EVs.

"EVs are becoming more and more affordable in New Zealand to buy and to run. Since the Clean Car Discount began on 1 July, we understand hundreds of EVs have already been registered.

"EVs can be fuelled at home for the equivalent of 30-40 cents a litre. New Zealanders in the market for a new or second-hand car should consider that the costs of owning an electric vehicle are lower than a petrol equivalent.”

Gilbert indicated that Drive Electric was not advocating for EVs to be permanently excused from the levy.

"Drive Electric has advocated for a short-term extension. However, as EVs inevitably become a larger share of our national fleet, we will need to consider how we fund future roads and maintenance.

“Therefore we support the extension being temporary, and can be re-assessed as necessary."

Wood says the Government is set to continue to take action to tackle transport emissions to meet NZ’s 2050 carbon neutral target.

“Part of this is helping Kiwis into cleaner cars.”

Wood notes the clean-car discount starting in January will help with the upfront cost of buying an EV, while the RUC exemption provides support to all owners of zero-emissions cars.