14 Jul 2019

Bridges: Clean vehicles plan would cost up to half billion dollars

4:57 pm on 14 July 2019

The opposition leader Simon Bridges says the government's proposal to subsidise clean vehicles will cost taxpayers half a billion dollars in new taxes, and won't be revenue neutral.

Simon Bridges

Simon Bridges says the claim the scheme will be revenue neutral is incorrect. Photo: RNZ / Dom Thomas

The proposal would mean about $8000 off the price of a new or near new imported electric vehicle, while the heaviest petrol and diesel polluters would cost $3000 more.

But Mr Bridges said the claim the scheme would be revenue neutral was incorrect.

"Even if you saw a doubling of EVs and small cars, which I think in itself is a pretty strong ask, on the numbers we've crunched there's four-to five hundred-million dollars in taxes coming in over subsidies and that's a sneaky half-a-billion dollar tax grab into the government's coffers."

He said even if imports of electric and low-emission cars doubles - putting an extra 26,000 on the roads annually - the scheme would raise more in taxes than it pays out in subsidies each year, adding up to between $400 million and $500m over the first five years.

The scheme would only apply to vehicles imported into New Zealand and not to cars that were already here.

Associate Transport Minister Julie Anne Genter declared climate change "our generation's WWII" in her defence of proposed car price hikes.

She made the declaration on Twitter when defending the government's proposed fees.

The government disputes Mr Bridges claims saying he misunderstands how the scheme will work over time.