Motor industry pushes to extend fringe benefits tax discount for plug-in hybrid cars as sales surge

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A tax benefit has allowed Australians to save tens of thousands of dollars when buying plug-in hybrid cars but the motor industry warns that is set to end next year and it could slow sales and undermine emissions reduction efforts.

Plug-in hybrid sales have doubled from last year but the scheduled end of a tax discount could frustrate that.An unexpected resurgence in the popularity for hybrid cars has prompted the motor industry to ask that tax benefits be kept for plug-in hybrids, saying they will remain "critical" to cutting carbon emissions over the next decade.

Motor Trades Association boss Matt Hobbs said it was a sign plug-ins were still filling a need for Australians, both in what they could do and their price. Mr Hobbs said in light of the ongoing cost of living crisis, unexpected sales trends and now an overarching climate policy for the industry, the government should revisit its decision to end tax benefits for plug-in hybrids.

A spokesperson for Treasurer Jim Chalmers said the electric car discount was a "win" for motorists, businesses and climate action.

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