The Government is accelerating the response to climate change to achieve a carbon neutral target for New Zealand by 2050. It announced the proposed Clean Car Standard in January 2021. The introduction of the Clean Car Discount scheme on 1 July 2021 aims to help bring down transport emissions by making the purchase of zero and low-CO2 emission vehicles more affordable.
CloseThe Clean Car Discount programme encourages the purchase of electric or low-CO2 emission light vehicles by reducing the cost of eligible new and used fuel-efficient vehicles coming into New Zealand and, subject to legislation being passed, will introduce a fee on high-polluting vehicles from 2022. A discount, in the form of a rebate, is being offered for eligible imported zero and low-CO2 emission vehicles from 1 July 2021 until 31 December 2021. From 2022, it is proposed, subject to legislation being passed, that fees and rebates will be applied according to the CO2 emission of vehicles. The higher the CO2 rating the greater the fee and the lower the CO2 rating the greater the rebate.
CloseThe Clean Car Discount is available to new and used light battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs). See eligibility criteria for other requirements. Petrol hybrids are popular vehicles but are not charged from electricity and are not eligible for a rebate from 1 July to 31 December 2021. They may become eligible in 2022, when it is proposed that a range of discounts and fees will be introduced based on the CO2 rating.
Clean Car Discount eligibility requirements
CloseA light vehicle is car, SUV, ute, van or truck with a gross vehicle mass (GVM) of no more than 3.5 tonnes. The GVM is the weight of a vehicle plus the maximum weight it can carry. See eligibility criteria for details.
Clean Car Discount eligibility criteria
CloseRebates are available for eligible light battery electric vehicles (BEVs) and light plug-in hybrid electric vehicles (PHEVs) registered between 1 July and 31 December 2021. If funding permits, applications will be accepted up until 28 February 2022 for vehicles registered between 1 July and 31 December 2021.
From 2022, subject to legislation being passed, it is proposed that the Clean Car Discount Programme will provide a range of rebates for new and used imported low-emission and hybrid light vehicles and will charge a fee for high-polluting vehicles based on the CO2 rating of the vehicle. All vehicles below a CO2 rating zero band will be eligible for a rebate and those above the zero band will incur a fee.
CloseYou can apply online once the vehicle has been registered and allocated a number plate. The rebate will only be paid into the registered person’s bank account, with the exception of lessors, who may be eligible when they are not the registered person.
To apply, fill out the application form on the Waka Kotahi website and upload the required supporting information – you will need the vehicle plate number, a copy of the vehicle sale agreement and your bank account details. Registered motor vehicle traders will also need to provide the required statutory declaration. Lessors will also need to provide the Acknowledgment of lease agreement.
CloseThere are four rebates available, based on electric vehicle type and whether it is a used or new vehicle:
| 1 July–31 December 2021 (GST incl) | New vehicle | Used import |
|---|---|---|
| Battery electric vehicle (BEV) (zero emission) | $8625 | $3450 |
| Plug-in hybrid electric vehicle (PHEV) (low emission) | $5750 | $2300 |
GST is included in the rebate except for public authorities. GST-registered businesses receiving rebates for work vehicles will return the GST.
CloseWhere a vehicle is registered to a lessee, the lessee is not eligible to receive a rebate. Instead, the lessor may receive the rebate, if they meet the eligibility criteria.
CloseDealers are eligible for a rebate for a vehicle they own and use as a company car, courtesy car or demonstration vehicle. The registered motor vehicle trader must not sell, or offer to sell, that vehicle within 3 months of first registration. All other eligibility criteria will also need to be met.
CloseThe buyer will not be eligible for a rebate because they will not be the first registered person to the vehicle. This is because rebates are only payable to the first registered person (with the exception of lessors).
CloseThe average used imported vehicle is 7-years old when it arrives in New Zealand. A new EV will on average spend seven more years reducing CO2 emissions and therefore is considered more valuable.
CloseTo avoid luxury vehicles receiving unnecessary subsidies.
CloseNo. The most common electric vehicles dating back to 2012 are generally above 3 stars in the star safety ratings. With all vehicles, there are always less safe models and we recommend buyers use the Rightcar website to help choose the safest vehicle affordable.
rightcar.govt.nz(external link)
CloseYes. If the application was declined due to an error, this can be corrected and the application resubmitted. If it was declined due to ineligibility, the application won’t be successful if resubmitted.
CloseIf, due to demand, rebate funds are exhausted, no rebate will be paid. Once the scheme restarts, only vehicles registered from the restart date will qualify for a rebate.
CloseBy later this decade more than 50% of monthly vehicle sales in New Zealand need to be electric. This target requires a jump from about 6000 electric vehicles (bought in 2020) to annual sales of 150,000 electric vehicles. later this decade more than 50% of monthly vehicle sales in New Zealand need to be electric. This target requires a jump from about 6000 electric vehicles (bought in 2020) to annual sales of 150,000 electric vehicles.
CloseIn June 2021, there were over 27,000 light EVs, which was 0.6% of the light vehicle fleet.
CloseAbout 2% of monthly registrations of all light vehicles over the past three years have been for electric vehicles. That is below the world average (4% in 2020), the average in Europe (10% in 2020), and well behind nations with strong transport emissions policy. In June 2021, there were over 27,000 light EVs, which was 0.6% of the light vehicle fleet.
CloseYes, they tend to be. That’s why the Government is introducing the Clean Cars Discount – to help make clean cars more affordable.
CloseNew legislation needs to be passed to govern the operation and enforcement of the scheme and a new IT system and administration operations set up to ensure its smooth and efficient operation.
CloseIn Budget 2021, $301.8 million was provided for the Clean Car Discount.
CloseWaka Kotahi NZ Transport Agency will administer the scheme.
CloseTo save people money on the purchase of an imported new or used light BEV or PHEV as soon as possible, a flat rate rebate is available until the end of 2021. The rebate supports those people choosing to buy an eligible low-emission vehicle this year while the full Clean Car Discount programme is being established.
CloseSubject to legislation being passed, it is proposed that fees and discounts will be set according to CO2 emission ratings based on international testing protocols. Ratings are intended to be calculated using the World Harmonized Light-duty Vehicles Test Procedure (WLTP). It intended that vehicles supplied with other testing protocols will be converted to WLTP. Rebates and fees will be reviewed regularly.
CloseSubject to legislation being passed, it is intended that dealers will be required to display the CO2 emissions fee or discount on the windscreen of the vehicle for sale and in online advertising from 2022. This is in addition to the star rating and fuel economy information that is currently required to be displayed on a Vehicle Fuel Economy Label (VFEL).
Waka Kotahi will work with Energy Efficiency and Conservation Authority New Zealand (EECA) and the Ministry of Business, Innovation and Employment (MBIE) to ensure dealers comply with any labelling regulations that come into force.
CloseIt is proposed that the fee will be paid to Waka Kotahi at the time of registration, and a vehicle will not be registered until payment has been made.
CloseEVs are cheap to drive. On average, electricity from a home or business overnight is equivalent to fuel costing 40c per litre.
CloseApplicants should contact the IRD or their tax adviser for guidance on any tax implications associated with receipt of the Clean Car Discount, including in relation to fringe benefit tax, income tax and depreciation treatment.
CloseIt is proposed that from 2022 the Clean Car Discount scheme will be based on CO2 emission ratings. There is a zero band in the ratings at which there is no discount (rebate) and no fee is payable. A vehicle with a CO2 rating above the zero band incurs a fee. The further above the zero band, the greater the fee up to a maximum value. Vehicles with CO2 ratings below the zero band are eligible for a discount (rebate), up to a maximum.
It is intended that the Clean Car Discount rates for 2022 will be finalised later this year. The following rates are proposed (including GST):
The proposed Clean Car Standard, which will require legislative changes to become law, is a government target that will regulate importers to reduce CO2 emissions of vehicles entering New Zealand to specific standards.
CloseThe Clean Car Standard would incentivise importers/distributors to supply cleaner cars to those living in New Zealand. If more vehicle buyers purchase electric vehicles because there are more low-emission options available, the vehicle carbon emissions in New Zealand will be reduced, helping achieve the Government’s target of being carbon neutral by 2050, and its commitment to the Paris Agreement on climate change.
CloseNew Zealand is well behind some countries, including the United Kingdom and Japan, which have already achieved our 2025 target.
CloseThe goal is for New Zealand to be carbon neutral by 2050 and we have committed to reducing greenhouse gas emissions (primarily carbon dioxide CO2) to 30% below 2005 levels by 2030.
In New Zealand, approximately half of CO2 emissions come from transport, of which two-thirds come from light vehicles. Transport emissions have been rising faster than other sectors, almost doubling between 1990 and 2020.
CloseIt will save the economy money rather than place costs on it.
ClosePublic consultation was carried out in 2019. There was strong support for the Clean Car Standard from 85% of the 967 submitters who responded to the discussion document question: “Is a Clean Car Standard appropriate for New Zealand?”
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