A proposal for a decarbonization tax discount to increase Australian lithium production to meet electric vehicles and net zero global targets

Current commitments with net zero 2050 require that more than two billion electric vehicles (EVs)
be produced globally by 2035. Australia produces more than 55% of the global lithium in the world.
We argue that Australia's most significant contribution to realizing net zero 2050 could be to
increase lithium production 10-20-fold by 2035. A similar case could equally be made for
increasing other critical minerals. This would also contribute to securing Australia's energy and
national security. To realize these benefits current investment in lithium is much lower than the
production of lithium batteries used in EVs requires, reflecting suboptimal tax rates. We conclude
by proposing that a decarbonization tax discount for critical minerals is needed.