Green Party adds another tax break to manifesto

The Green Party announced today it would scrap fringe benefit tax when businesses purchased electric cars for their fleet. Photo / iStock

The Green Party has added a second tax break for businesses to its manifesto in a bid to boost electric car use in New Zealand.

The party announced today it would scrap fringe benefit tax when businesses purchased electric cars for their fleet.

The tax is applied to any perks which staff receive as part of their employment, including motor vehicles.

It was estimated that the proposed tax break would cut the upfront costs of an electric car by 36 per cent.

Green Party transport spokeswoman Julie Anne Genter said it would provide a major incentive for businesses to switch to cleaner, more efficient fleets.

The exemption would last for seven years. Under a low-uptake scenario the policy would cut the Crown's revenue by $24 million in the seventh year.

In order for the policy to work, further investment would be required in charging technology.

The Greens also proposed a $10 million investment in fast-charging stations, which took 30 minutes to charge a car.

The policy received some initial support from the business sector, with Xero boss Rod Drury describing it as a "good move".

Transport Minister Simon Bridges said the Government preferred policies which removed regulatory barriers and "nudged things along" and not "big-spending, subsidising policies".

Mr Bridges has described New Zealand as "one of the most electric car-ready vehicles in the world" because of its high proportion of renewable energy, drivers' short journey distances and plentiful off-street parking.

But uptake has been slow in New Zealand, with just 400 electric cars on the roads at present.

The Government's main policy targeted at increasing the electric fleet was an exemption on road user charges.

Mr Bridges said in a speech last month that he was looking at ways to support the expansion of the electric fleet, but also that he expected the private sector to lead the way.

The transport sector produces 20 per cent of New Zealand's greenhouse gas emissions, and cutting this pollution is seen as more palatable and achievable to the Government than cutting agriculture emissions.

Greens have previously proposed lowering the corporate tax rate to 27 per cent to offset a carbon tax.