E-bikes could replace many cars in the daily city commute with a tweak to current tax laws, according a national peak body.
The National Automotive Leasing and Salary Packaging Association (NALSPA) said as many 57,800 extra e-bikes could be on Australian roads within a year if the current fringe benefit tax (FBT) exemption had no restrictions on private use.
NALSPA chief executive Rohan Martin said interest was growing among workers and employers for salary packaged e-bikes, but changes were necessary to increase uptake.
Mr Martin said e-bikes were a perfect modern transport solution by reducing the cost of living, increasing exercise and being environmentally friendly.
“Cycling culture in Australia is still immature compared to other countries, unless you’re a lycra-clad devotee. E-bikes are changing the game,” he said.
“E-bikes require less effort to pedal, can carry more weight and travel further distances much easier, making them more practical and accessible for a larger number of people.
“Riding e-bikes is a very economical way to commute that can lead to significant savings compared to a car and even public transport. You’re not paying for parking, fares or fuel.”
Mr Martin said the FBT exemption in place for e-bikes could apply through a salary package arrangement and help reduce the purchase price and running costs for workers.
“But awareness is low, and there is red tape as use is largely restricted to travel between home and work.”
He said the FBT exemption laws for e-bikes should be amended so that there were no limitations on private use, just as it worked for electric and plug-in hybrid vehicles.
“Just as we’ve seen with the success of the FBT exemption for electric vehicles, which has helped see EV (electric vehicle) sales grow 150 percent between 2022 and 2023, if you get the policy settings right for e-bikes we’ll likely see them surge in popularity.”
Mr Martin said before the EV FBT exemption was introduced, battery and plug-in vehicles represented less than two percent of total SUV and passenger sales in Australia.
“In recent months, they have represented more than 14 percent.”
He said the cost savings on an e-bike could be greater on a novated lease as riders could get hold of an e-bike with zero upfront cost, repayments as low as $3 a day, no GST on the purchase price, a reduction in taxable income, and no FBT if the bike was mostly used for commuting and work purposes.
