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Are Australia’s road taxes and charges all a bit of a mess?

A legal case that could change the way all motorists are taxed to use the roads, went before the High Court in February, attracting lawyers from every state and territory on one side pitted against the Federal government on the other in what’s turned out to be a lawyer’s picnic.

It all started when a couple of disgruntled Victorian electric vehicle drivers, Kath Davies and Chris Vanderstock, got as mad as hell about their state government’s tax on electric, hydrogen and plug-in hybrid electric vehicles and decided they weren’t going to take it anymore.

Ms Davies, who’s passionate about the environment and a strong supporter of electric vehicles, decided the Victorian government’s Zero and Low Emissions road user charge discriminated against EV owners who were trying to do the right thing.

"At the time, I have to admit, I was angry. It was about 15 years of frustration, of not seeing enough climate action, and I'd never considered climate litigation as a tool for change," she said.

"The electric vehicle tax in Victoria, in my opinion, is a discriminatory tax against electric vehicle drivers and it's putting the brakes on EV adoption. It's making it more difficult for people to go to EVs."

So she and Mr Vanderstdock called on Equity Generation Lawyers to take the Victorian Government to court in a case that was funded by other EV enthusiasts.

Their case is that the tax is a tax on goods and an excise, which should properly be the preserve of the Federal Government, not the states or territories.

And because that’s raised constitutional issues it’s started a legal free-for-all with lawyers for the states and territories on one side lined up against lawyers for the Federal Government on the other, with the plaintiffs’ lawyers in the thick of it biffing it out as well.

What’s at stake?

For motorists, what’s probably at stake here is the future of road taxes on their vehicles. With the increasing popularity of EVs, their drivers could be facing a tax regime that differs across Australia as each state and territory attempts to levy their own set of charges.

As it stands it’s all a bit of an inconsistent national mess with Queensland, the NT, the ACT and Tasmania yet to introduce road user charges, while the rest of Australia has. Well, except for SA that is, which had one under its Liberal government, but now doesn’t under its new Labor government.

And spare a thought for those hybrid drivers who are copping it twice. In some places, they’re paying a road user charge because they’re driving an EV, as well as the Federal Government’s fuel excise whenever they fill up their tank.

See what I mean by a mess?

You’d think that at some stage governments around Australia are going to have to sort this out on a nationally consistent level because the increasing sales of EVs means they can’t keep kicking this can down the road much longer.

The Federal Chamber of Automotive Industries’ chief executive Tony Weber thinks a universal road user charge is the way to go. It certainly has the virtue of consistency and simplicity.

"Such a scheme would result in a more equitable taxation system for consumers as numbers of zero and low-emission vehicles on Australian roads continue to grow," he said.

However, Australian Electric Vehicle Association national president Chris Jones has made the controversial suggestion that on top of such a charge the 44.2 cent per litre fuel levy should remain on internal combustion vehicles as a pollution tax to encourage electric vehicle take-up.

But that’s a suggestion that could best be described as “politically courageous” and one that’s highly unlikely to see the light of day.

Written by
Mark Schneider

Mark is a successful copywriter with over 20 years of professional writing experience.

We welcome him as a guest blogger to Fleettorque.

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