Government Cuts CCS Penalty To $7.50/g From 1 January; VIA Welcomes Relief & Pushes For Structural Fixes In 2026 Review

The Imported Motor Vehicle Industry Association (VIA) welcomes the Government’s decision to reduce the Clean Car Standard (CCS) penalty for used vehicle imports to$7.50 per gram of COfrom1 January 2026, applying through2026–2027, alongside amajor review of the CCS in 2026.

VIA understands the penalty change will be included with legislation currently before the House that willextend credit lifeandenable credit trading between new-vehicle and used-vehicle accounts, with both measuresset to commence 1 January 2026.

“This is a sensible circuit-breaker,” saidGreig Epps, Chief Executive of VIA. “It will take the heat out of prices while the system is reviewed. Our members have supplied the evidence and case studies that got us here, and we thank Ministers and MPs who listened.”

Why it matters

· Around70% of used imports are currently penalisedandabout half of those penalties are more than $1,000. At that level, buyers in the$10–$15kbracket often walk away or trade down, slowing fleet replacement.

· With fewer mid-life vehicles coming in to refresh the fleet,people are holding onto vehicles longer,increasing the age of the fleet andslowing - if not reversing - gainsmade in previous years.

· A lower penalty rate shouldstabilise retail pricing,keep buyers in the market, andaccelerate fleet refresh, improving emissions and safety outcomes.

· Credit-life extensionandcross-sector credit tradingwill help unlock value stranded in new-vehicle accounts andlower costs for consumersin the used market. 

VIA emphasised that the2026 review must fix the underlying architecture, in particular theweight adjustment in the target-setting algorithm.

“A key problem is weight adjustment,” Epps said. “It distorts outcomes for practical family cars. Judge vehicles on their actual emissions and let credit trading work across the whole market. That’s how you deliver affordable, lower-emitting cars into Kiwi driveways faster.”

VIA also noted the importance oftimely decisions in 2026to avoid reform being delayed by the general election period.

“We support pragmatic relief now and decisive settings next,” Epps said. “Keep the review tight and early, remove or neutralise weight adjustment for passenger vehicles, and make credit trading work in practice from day one.”

ABOUT

VIA (Imported Motor Vehicle Industry Association) represents businesses involved in importing, preparing, wholesaling, and retailing used vehicles into New Zealand, primarily from Japan, Singapore, and other markets. As the industry's collective voice, VIA engages with government and stakeholders to support fair regulation and sustainable practices across the sector.

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