South Australia axes electric car subsidy, following Victoria and NSW

South Australia has become the third local jurisdiction to repeal its subsidy for buyers of new electric and hydrogen-powered cars, announcing its $3000 rebate will end in 2024.

In the state’s mid-financial year 2023/24 budget review, Treasurer Stephen Mullighan said the subsidy would be removed by 1 January 2024, after 2500 rebates had been handed out since it was introduced on 28 October 2021.

The $3000 subsidy – which applies to electric vehicles and hydrogen-powered cars valued below $68,750 plus on-road costs – will continue to be available to motorists who place an order for an eligible vehicle before the deadline.

With approximately 4500 subsidies yet to be collected by South Australian new-car buyers, the scheme’s axing represents a saving of about $13.5 million for the state government’s budget.

South Australia will continue to provide free registration for three years to eligible electric and hydrogen vehicles until 30 June 2025, the end of the 2024/25 financial year.

In February, the South Australian government abandoned its plans to introduce a controversial road-user tax for electric cars, initially due to come into effect from July 2027, or when electric vehicles reached 30 per cent of new-car sales in the state. 

The state’s decision to ditch its electric-car subsidy follows Victoria axing its $3000 electric-car subsidy from July 2023, while New South Wales will also repeal its $3000 rebate and free stamp duty offer on 1 January 2024.

Sales of electric cars in Australia are at an all-time high, with the 80,446 battery-powered vehicles sold between January and November 2023 representing an increase of 184 per cent on the same period last year.

In 2022, 33,410 electric cars were sold across the 12 months of the year – up from the 5149 sales in 2021, although market leader Tesla did not start reporting local deliveries until March 2022.