Coalition pledges to abolish federal EV subsidy in $9.4 billion climate savings package
Opposition Leader Angus Taylor has released costed plans to scrap electric vehicle concessions, home battery subsidies and other climate programs, with a Coalition government vowing to abolish the $2.1 billion EV subsidy if elected at the next election.
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Coalition vows to scrap the EV subsidy
The federal Coalition has pledged to abolish Labor's electric vehicle subsidy if it wins government, arguing taxpayers should not help fund other Australians' car purchases. Shadow Attorney-General Michaelia Cash confirmed the plan on Sunrise, saying the move would deliver $2.1 billion in savings and accusing Treasurer Jim Chalmers of a "spending addiction", in reporting by 7NEWS. "Australians can buy any car they like but the Australian taxpayer, doing it tough under this government, shouldn't have to subsidise that," Cash said, per 7NEWS. 3
The pledge forms part of a wider opposition savings agenda released at a Parliament House press conference by Opposition Leader Angus Taylor and Shadow Treasurer Tim Wilson. The package claims $31.3 billion in savings over four years, costed by the independent Parliamentary Budget Office, though the ABC notes the update is incomplete and does not cover the cost of the Coalition's migration cuts or its plan to scrap Labor's tax changes. 21
What the climate bundle covers
The EV subsidy is bundled with other climate measures rather than itemised separately in the broader costings. According to the ABC, scrapping the new vehicle efficiency standard, the electric vehicle discount, home battery subsidies, the net zero advisory body, some functions of the renewables agency ARENA, and Scope 3 emissions reporting for business would together save $9.4 billion over four years. The Canberra Times likewise reports the largest single saving in the plan is $9.4 billion from climate change programs, including dismantling the Net Zero Economy Agency, overhauling ARENA and abolishing electric vehicle concessions, the home batteries program and Scope 3 reporting requirements. 21
Taylor told reporters at Parliament House, in remarks carried by The Canberra Times, that a Coalition government would make "significant saves" from cuts to "Labor's climate bureaucracy" and "housing bureaucracy", adding: "Obviously, everything here is a sensible saving. These are all spends ... that right now we don't need." 1
How the current EV subsidy works
Under the arrangements 7NEWS describes, vehicles priced below $91,000 currently receive the full tax exemption, with the threshold set to fall to $75,000 from April next year. Environment and Water Minister Murray Watt told the program the government had already adjusted the scheme to reduce the discount available for more expensive electric vehicles, and rejected suggestions the subsidy primarily benefited wealthy buyers, arguing it helped drivers in outer suburbs save on fuel over longer commutes. 3
Watt framed the subsidy as a cost of living as much as an environmental measure, pointing to higher fuel prices and saying it was "actually helping Australians right now to deal with the kind of higher fuel prices that we're seeing as a result of the Middle East conflict," according to 7NEWS. He also said the government had found about $180 billion worth of savings while in office. 3
Home battery program under scrutiny
The home batteries program, also slated for abolition under the Coalition plan, has drawn scrutiny over its cost. The Department of Climate Change, Energy, the Environment and Water revealed at Senate estimates, as reported by The Canberra Times, that the program had blown out by $500 million in 2025-26 and reached $4.63 billion by September 2026, with officials saying initial settings drove very high uptake before the government reduced the subsidy in its May budget. 1
Industry Minister Tim Ayres defended the scheme, The Canberra Times reports, calling it a "roaring success" that had reduced evening peak gas generation and delivered savings for regional and outer-suburban families. 1
Political and fiscal context
The costings are unusual in being released well before an election, with opposition costings typically finalised close to polling day, the ABC reports, citing a Liberal source who said the emphasis on spending cuts was intended to sharpen attacks on Labor's spending. Taylor framed the savings as a "down payment" to fund the Coalition's promised tax cuts, which the PBO separately costs at $9.7 billion. 2
The opposition has accused the government of fuelling inflation with its spending, a claim Treasurer Jim Chalmers denies. Chalmers told Nine newspapers' Inside Politics podcast, as reported by The Canberra Times, that the government was budgeting "responsibly" and had made "a very serious effort to make sure that spending in the budget is sustainable", and he claimed the Coalition had more than $110 billion of unfunded commitments, a figure that includes interest on borrowed funds. Shadow Treasurer Tim Wilson said the Coalition had been working with the Parliamentary Budget Office on its costings while declining to release them publicly. The ABC notes the $31.3 billion package is unlikely to offset the Coalition's remaining policy commitments, including tax, migration and defence spending plans. 21
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