EV road user tax firms for Australia
A national tax on electric cars still a priority for the Federal Government according to a new reportAustralians could soon be stung with a national road-user tax for electric vehicles which, if approved, would see Australian drivers charged per kilometre travelled.
According to a report by the Australian Financial Review (AFR), Federal treasurer Jim Chalmers reportedly again touted an EV road user charge at a Business Council of Australia dinner in Canberra last week.
But it’s not the first we’ve heard of the scheme, with the treasurer confirming an electric vehicle tax was coming in the ‘next few years’ back in August 2023, in a bid to redeem lost funds from lower fuel excise revenue, due to the increasing uptake of electrified vehicles.
Now Chalmers has been quoted as telling those attending the dinner that the drop in fuel excise revenue is “one of the challenges that needs addressing” and that “we need to pay for roads somehow”.
A spokesperson for the treasurer reportedly told the AFR: “We will work with the states and territories on policies in this area following the decision in the High Court, but we’ll do it in a considered and consultative way and take the time to get it right.”
Similar taxes have already been introduced at a state level. Victoria introduced its own EV road user charge back in 2021, charging a 2.8 cent tax per kilometre driven by pure electric (BEV) or hydrogen-powered vehicles, and 2.3 cents per kilometre for plug-in hybrid (PHEV) vehicles.
It cost EV and PHEV drivers in Victoria a whopping $3.9 million during the 2022-2023 financial year alone, but it was later deemed to be unconstitutional and was therefore scrapped.
Other states including NSW and Western Australia have also pledged to introduce their own taxes, despite the High Court challenge Victoria faced with its road user charge.
Pundits are now calling for a “fairer” tax, with Australian Electric Vehicle Association president Chris Jones releasing a media statement last week stating that any national road user charge should replace the fuel excise entirely and apply to all vehicles.
“A universal ‘mass times distance’ road user charge should eventually replace fuel excise as the user-pays component of roads and their maintenance,” said Jones.
“This should also be extended to heavy vehicles, as trucks are responsible for the bulk of road damage. Australia’s two most popular family vehicles – the Ford Ranger and Toyota HiLux – tip the scales at well over two tonnes, and neither of them are EVs.”
The tax is unlikely to be introduced until after the next Federal Election, which is expected to occur in May.
Meanwhile, the 2025-2026 federal budget is due to be announced on March 25, 2025.
Related: Victorian government to refund unconstitutional EV tax – with interest
Related: National EV tax coming in ‘next few years’
Related: Victoria backs user-pays road tax for all motorists
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