ACT government to lower duties for fuel efficient cars

ACT government to lower duties for fuel efficient cars

Changes to ACT government duties on new car purchases will see drivers who buy low-emission vehicles rewarded and those who choose less fuel-efficient cars charged more.

Roads and Parking Minister Mick Gentleman will on Tuesday announce changes to the government duty scheme, in a move designed to reduce greenhouse gas emissions caused by traffic on Canberra's roads.

Planning Minister Mick Gentleman.

Planning Minister Mick Gentleman. Credit:Rohan Thomson

The change comes as the federal government's fuel efficient car guide moves from a star rating system to a single carbon dioxide rating, making emission figures the primary ranking of a car's environmental credentials.

A new ACT vehicle emissions reduction scheme will continue to measure all new light vehicles with a performance rating. Cars, utilities and light commercial vehicles will be allocated a performance rating based on their carbon dioxide emissions, showing grams emitted per kilometre of driving.


New vehicles that emit up to 130 grams of carbon dioxide per kilometre will achieve an "A" rating, seeing motorists pay no duty.

Vehicles significantly above average environmental performance will get a "B" rating and will receive a 50 per cent discount compared to the previous scheme. Those vehicles with "C" and "D" ratings, for average and below average environmental performance, will pay the same rate as under the previous scheme.

Second-hand cars and any vehicles not included in the green vehicle guide, including motorcycles, will continue to pay duty equivalent to vehicles with a "C" rating.

The scheme is designed to increase the availability of greener cars in the secondhand market by influencing new car purchases over time in a "trickle-down effect".

A "B" rating car emitting 2200 kilograms of carbon emissions per year and using $1260 worth of petrol would attract duty of $215. A "C" rating car emitting 2700 kilograms of CO2 emissions and using $1537 of petrol per year would attract duty of $989.70. A "D" rating car emitting 3500 kilograms and using $1746 of petrol would attract duty of $1359.60.

The figures are based on last year's best selling new cars in the ACT: the Volkswagen Golf 1.4 litre, Toyota Corolla 1.5 litre, Subaru Forester 2.5 litre and Mitsubishi Triton 2.5 litre diesel.

Transport is estimated to produce almost 25 per cent of all the territory's greenhouse gas emissions and is the second largest source of emissions after stationary energy.

Used cars are not included in the new scheme due to inconsistent environmental data for older cars and changes in emissions through vehicle condition.

Mr Gentleman said the changes, considered revenue neutral by the government, are designed to push consumers towards cars with lower operating emissions.

"The ACT government remains the only jurisdiction in Australia to have a differential duty scheme for new light vehicles to provide an incentive for the purchase of low-emission vehicles and a disincentive against the purchase of vehicles with poor environmental performance.

"The government is committed to working with Canberrans to protect our environment. The new scheme will help people buy greener vehicles and reduce fuel costs," he said in a statement.

Tom McIlroy is a political reporter for the Financial Review in the federal press gallery at Parliament House.

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