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Government announces changes to the Clean Car Discount programme

In brief
  • Changes to the Clean Car Discount programme come into effect 1 July 2023. 
  • New EV rebates will drop. More vehicles will be charged high emissions fees and ute taxes will rise dramatically.
  • Critics argue farmers and tradies are unfairly punished by increased fees, while Tesla owners enjoyed the programme’s biggest payouts.

A victim of its own success

The Clean Car Discount (CCD) scheme subsidises the purchase of low-emission vehicles. This is supposed to be funded by charging fees on higher-emitting vehicles. It was pitched as revenue neutral when  launched in July 2021.

However, the program is paying out more than it collects. The Government has since announced changes from 1 July 2023. There will generally be lower incentives on fewer types of vehicles, while more vehicles will be considered higher emitting and therefore carry extra fees.

On one end, rebates on new EVs will drop $1510, to $7015. Those on used imports however will increase by $57, to $3507. Low-emitting disability vehicles will also receive a special discount. On the other end, new gas guzzlers will now be charged a maximum $6900 in fees, and used imported gas guzzlers will see fees increased to $3500.

Only hybrid and EVs will still be eligible. Discounts on low-emitting petrol vehicles will be discontinued.

Double cab utes such as the Ford Ranger and the Toyota Hilux will see their fees rise dramatically, about 100%. 

Government announces changes to the Clean Car Discount programme - Centrist
Subsidies have driven reduced emissions vehicles, but now the Government’s taking some punch out of the bowl.

Criticism of the plan 

The National Party’s Simeon Brown said the ute tax would be “a kick in the guts” to “hard-working farmers and tradies”. Minister of Transport Michael Wood replied the policy is about addressing climate change and the Opposition wanted to turn it into “another tacky little culture war”. 

Brown also questioned whether this was a scheme for the rich, as luxury car Tesla purchasers have received the lion’s share of the $83m in subsidies. Wood countered that while Tesla owners did receive the most money under the scheme, Toyotas represented the largest number of vehicles subsidised at around 38,000 (compared to around 9,700 Teslas).

According to Deputy Prime Minister Carmel Sepuloni, the focus is on getting Aucklanders out of high-emitting vehicles by imposing heavier fees on their purchase.

The Motor Industry Association criticised the timing of the plan. They argue the short notice affects buyers on waitlists who have expectations about the purchase price of their vehicles. The changes also affect supply orders that will need to be adjusted as market conditions react to new pricing. 

Suzuki New Zealand says they weren’t notified of the changes beforehand, and will have to inform customers they are no longer eligible for discounts they have been anticipating. They also argue Suzuki had a lot of models on offer that qualified for subsidies but won’t have a single vehicle on the list after July 1st. 

Over a third of imported vehicles into NZ over the past year have been reduced emissions vehicles. A shift in the market largely driven by incentives – now potentially set to change again.

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