One of the many changes brought about by the COVID-19 pandemic is the incredible shift in power to state and territory governments. Measures which directly affect people such as lockdowns, mask mandates, density limits and border closures have all been issued by state and territory Premiers or Chief Ministers. The Premiers and Chief Ministers now enjoy national profiles and have clearly been emboldened to the extent that they are now exerting their influence into other areas of public policy, including in the automotive industry.

Before the pandemic, there were signs that state governments were eying off the automotive industry as a means of boosting their revenue. Vehicle stamp duty and the differing rates in the various states and territories have long been the bug bear of the industry. More recently, we have seen states like Queensland and Victoria introduce luxury stamp duties.

These state LCT’s are simply bad public policy. They discriminate against safe and clean vehicles; promote jurisdiction shopping; and fall on vehicles that can hardly be described as luxury. Unfortunately, this seems like it is only the start and over the past two years, states and territories have doubled down, inserting themselves into the realm of low emissions vehicle policy.

We are now seeing some states offer incentives on the purchase of new electric vehicles, while others do not. How these incentives apply is inconsistent and we are also seeing differences in the approach by some state governments to road user charging for low emissions vehicles. It is not inconceivable that we will have some jurisdictions start an effective ban on internal combustion engine vehicles by denying registration to such vehicles.

The risk of going down the state-by-state approach is that Australia ends up with a patchwork system. At its most extreme you could see significant differences on all elements of low emissions policy ranging from tax, electricity grid requirements, automotive skills policy, training of emergency services, building standards, infrastructure requirements, and the list goes on.

All governments need to work constructively to develop and implement a national plan which facilitates a consistent approach to the emergence of low emission vehicles. This is too important an issue for industry, consumers, and the country – we need our leaders to get on the same page for the benefit of all.