EVs a "substantial risk to stability of the State’s finances"

rolion

https://www.thejournal.ie/electric-vehicles-spending-review-4767645-Aug2019/

THE INCREASING TAKE-UP of electric cars in Ireland over the next decade “could pose a substantial risk to the stability of the State’s finances”, the government has been warned.

The government’s spending review into the incentives offered to people to switch to electric cars (EV) states increased uptake will lead to significant declines in Exchequer revenues from motor and fuel taxation.

The review, carried out by the Department of Expenditure and Reform, states that these taxes “represent a significant proportion of total Irish Government revenues”.

....

Instead of recommending increased supports for drivers, it states that “a schedule of declining supports for EV take-up, which would end when the total cost of ownership gap between EVs and diesel and petrol cars is equalised, may provide a more sustainable pathway for government incentives moving forward, while providing certainty to vehicle purchasers, dealers and manufacturers”.

The review notes that the uptake in EVs is already having an impact on the Exchequer funding, stating that the cost revenue foregone to the end of 2018 has been estimated by the Department of Transport, Tourism and Sport at €5.74 million

The greatest barrier to people switching to an electric car is the cost, according to the department, noting incentives in other countries to encourage people to switch to electric, such as electric vehicles allowed access to the bus lanes in Norway, while in Italy a car scrappage scheme gives between €2,500 and €6,000 if you trade in your old fossil fueled car.

jimmycrackcorm

The declining revenue is ok considering there's a price to be paid for some climate action change.

The real problem is not the current subsidy incentives but how to deal with the drop in duty and vat on fuel. So expect to see extensive electronic road pricing aka M50 tolls everywhere

ted1

Have they omitted to look at the money staying within the state. Every time you put petrol in the car you are buying imported fossil fuel. As we use more renewables the money from fuelling the car is staying within the state

NIMAN

EVs will not affect the states finances, they will just tax the EVs instead of ICE cars.

I have an EV, and its going to cost me €120 to tax in the coming years.

I have no doubt it won't stay at €120 for too many years.

Soarer

It'll cost a lot more in carbon tax fines!

ted1

NIMAN wrote: »

EVs will not affect the states finances, they will just tax the EVs instead of ICE cars.

I have an EV, and its going to cost me €120 to tax in the coming years.

I have no doubt it won't stay at €120 for too many years.

They make about 80c per litre of petrol. You are forgetting about that.

unkel

ted1 wrote: »

They make about 80c per litre of petrol. You are forgetting about that.

That. And of course the income from VRT and motor tax in 2019 is far lower than it was in 2007, because of the stupid promotion of diesels in the changeover to CO2 based taxing. None of that deficit was ever recovered either. Between those two that's about 2 billion euro lost per year :mad: in promotion of cancer :mad:

It will have to made up eventually, at least partially. Maybe a substantial increase in tax or duty on electricity, but that would be electoral suicide. For sure a very large increase year in year out on fossil fuels. People can now see the need for that. And eventually road use pricing.

macnab

The lack of joined up thinking in our government is staggering.
Everything seems to be reactionary, constantly fixing the symptoms bull****.
Unfortunately the focus is on revenue first, health and wellbeing are distant concepts.
Diesel vehicles need to be taxed at such a rate as to make them no longer economical.
An increase in ICE vehicle tax and petrol/diesel tax makes more sense than reducing incentives to buy EVs.
Then as the balance tips more to EV use start to increase revenue from that sector.
Too much pandering to farmers and hauliers will of course keep the TDs from making the right decisions.

NIMAN

Politicians will never do anything that will make them lose their jobs, you have to accept this is going to happen.

The greater good? The environment?

They couldn't care less about these things, its their job, their livelihoods, their careers and the party that comes first.

kaahooters

so the article is correct, evs will cause a hefty chunk of financial loss for the state, THE STATE, not the government.
that tax money goes to schools, hospitals infrastructure, its not like its going straight into the pockets of some TD like.

get your heads out of your arses and stop bringing that american "the government took muh mohneys" attitude and grow up.

September1

There is this flawed assumption that money not spent on fuel will be not generating tax revenue. Money not spend on importing fuels will be now spend on something else within Irish economy and even with moderate fiscal multiplier it would offset a big chunk of lost excise duties.

There is also issues that EVs are rather expensive in comparison to petrol cars, so they do attract more VAT and VRT - which mean that even after grants and discount those cars are bringing money for the state.

Patser

ted1 wrote: »

They make about 80c per litre of petrol. You are forgetting about that.

So they not have some sort of levy on electricity too, as well as VAT. If you're home charging you're paying that - and public charging ain't staying free

ELM327

kaahooters wrote: »

so the article is correct, evs will cause a hefty chunk of financial loss for the state, THE STATE, not the government.
that tax money goes to schools, hospitals infrastructure, its not like its going straight into the pockets of some TD like.

get your heads out of your arses and stop bringing that american "the government took muh mohneys" attitude and grow up.

ehm, ok?


anyway, moving away from nonsense,.
State/Goverment whatever else - it's taxpayer money.
any loss will be made up by additional taxation, be this per diem, per km, etc, but it will be there.
And the difference will be EVs will only pay the additional taxation, whereas fossil cars will have to pay co2 based taxes and fuel duties as well as the additional taxation

Lumen

It's always possible that electricity taxes will go up, cue screaming from anyone who is using a heatpump in an even slightly leaky house; you can always generate your own electricity but not your own oil.

Ultimately all of this stuff (cars, batteries, solar/wind tech, oil) is imported so does it make much difference?

In any case fuel taxes are 3bn, VAT is 20bn so a couple of cent on VAT would probably make up the shortfall.

ted1

Patser wrote: »

So they not have some sort of levy on electricity too, as well as VAT. If you're home charging you're paying that - and public charging ain't staying free

Solar PV, micro wind, micro hydro etc are all ways that people can use to avoid levies on electricity

NIMAN

ted1 wrote: »

Solar PV, micro wind, micro hydro etc are all ways that people can use to avoid levies on electricity

Yeah, if you have plenty of money to spend on them.

Most don't.

...Ghost...

ELM327 wrote: »

ehm, ok?


anyway, moving away from nonsense,.
State/Goverment whatever else - it's taxpayer money.
any loss will be made up by additional taxation, be this per diem, per km, etc, but it will be there.
And the difference will be EVs will only pay the additional taxation, whereas fossil cars will have to pay co2 based taxes and fuel duties as well as the additional taxation

I have a problem with per mile taxation. I really don't like the idea of being charged on a cyclic basis for the miles I drive. If that comes in, we will see greater invasion of privacy in order to accommodate peak time charging for road use, with each mile being tracked by GPS. If they can justify charging €120 for a zero emissions vehicle, they can justify anything.

kanuseeme

...Ghost... wrote: »

I have a problem with per mile taxation. I really don't like the idea of being charged on a cyclic basis for the miles I drive. If that comes in, we will see greater invasion of privacy in order to accommodate peak time charging for road use, with each mile being tracked by GPS. If they can justify charging €120 for a zero emissions vehicle, they can justify anything.


Per mile tax

I would think it would be linked to the NCT, voluntary declaration at the end of each year, and then go to town on you, when they check the mileage for the test.

Then again its not possible to keep track of you with the NCT method.

ELM327

...Ghost... wrote: »

I have a problem with per mile taxation. I really don't like the idea of being charged on a cyclic basis for the miles I drive. If that comes in, we will see greater invasion of privacy in order to accommodate peak time charging for road use, with each mile being tracked by GPS. If they can justify charging €120 for a zero emissions vehicle, they can justify anything.

probably done by odometer reading at the NCT (which they already record)

ted1

NIMAN wrote: »

Yeah, if you have plenty of money to spend on them.

Most don't.

The poster claimed electricity prices will be taxed and increase. Solar PV would be cheaper than buying from the grid.

unkel

September1 wrote: »

There is also issues that EVs are rather expensive in comparison to petrol cars, so they do attract more VAT and VRT

Errr?

ELM327

Currently EVs with an OMSP less than 35k don't have any VRT

Varta

ted1 wrote: »

The poster claimed electricity prices will be taxed and increase. Solar PV would be cheaper than buying from the grid.

Only until they tax your solar PV.

ted1

Varta wrote: »

Only until they tax your solar PV.

And how would they do that...

Mickeroo

ted1 wrote: »

And how would they do that...

Only way I can think of is if they change one letter in the following term "TV License" :P

NIMAN

ted1 wrote: »

The poster claimed electricity prices will be taxed and increase. Solar PV would be cheaper than buying from the grid.

I know.

Most people will have to simply pay increased electricity prices, this is a common occurrence with or without EVs. Its happens and is often a few Euro per week/month etc.

I have no idea how much it is to have a solar PV system installed. Perhaps someone could enlighten me?

Thats the cost I said most people can't afford.

There's loads of people out there who can't afford outlay of several thousand to save a few Euro per week.

unkel

NIMAN wrote: »

I have no idea how much it is to have a solar PV system installed. Perhaps someone could enlighten me?

Top of the range large 4kwp array with battery, immersion diverter (will heat your water too) and battery €11k minus €4k subsidy = €7k installed by official SEAI approved installer

It will save a lot more than a few euro per week. And of course price of electricity is going to be a lot more than it is now.

But a PV install can be done far cheaper. To cover more than the base load of your house, put 2 brand new panels DIY on your shed with a second hand plug in inverter from eBay for about €400 in materials

ted1

NIMAN wrote: »

I know.

Most people will have to simply pay increased electricity prices, this is a common occurrence with or without EVs. Its happens and is often a few Euro per week/month etc.

I have no idea how much it is to have a solar PV system installed. Perhaps someone could enlighten me?

Thats the cost I said most people can't afford.

There's loads of people out there who can't afford outlay of several thousand to save a few Euro per week.

If the price increases as the poster expects , a Credit union loan to cover the cost of PV. Would make financial sense