ATO - New Vehicle Efficiency Standard (NVES) carbon credits

Question

Background: At the RRAT Estimates hearing on 26 May 2026, Transport Department officials gave evidence there is no prohibition on BYD or Tesla - or other foreign auto manufacturers earning NVES carbon credits -from taking money earnt from those credits back to their shareholders overseas (e.g. China). 1. The NVES legislation does not prescribe how NVES carbon credits are traded - or in which jurisdiction they are to be traded. There is no requirement to report NVES credit sales. It is entirely possible foreign owned auto manufacturers could trade NVES carbon credits overseas in foreign currencies. If that was to occur, how would or could the Australian Taxation Office calculate and levy tax on the overseas trade of up to $17.2 million worth of NVES carbon credits?

Answer

See attached response.

Documents

• Question with answer (PDF) (opens in a new tab)
• SQ26-000283 ATO - New Vehicle Efficiency Standard (NVES) carbon credits.pdf (opens in a new tab)