Electric Vehicle Owners to Face Road-User Levy, Says Federal Government
In a bid to plug a revenue gap, the Federal Government is fast-tracking plans to introduce a road-user levy on electric vehicles (EVs).
The move comes as a response to the decreasing fuel excise revenue from petrol and diesel sales, which is used to fund road upgrades.
Currently, EV owners do not contribute to the fuel excise, which generates 51.6 cents per litre at the bowser.
The proposed levy aims to offset the loss of revenue as more Australians switch to electric vehicles.
States and Industry Weigh In
The ACT Government has written to the Federal Government, suggesting a national road-user charge that targets all drivers, not just EV owners.
The proposal calls for the levy to be administered and collected nationally, with the revenue distributed among states and territories for road upgrades.
The Australian Automobile Association (AAA) also supports a national approach, advocating for any revenue generated from the levy to be used exclusively for road upgrades.
The AAA proposes calculating the charge based on distances travelled, although this concept raises constitutional concerns about discriminatory taxation.
Challenges Ahead
The introduction of an EV levy is not without its challenges.
Previous attempts by states to introduce similar levies have been met with legal hurdles, including a High Court ruling that only the Federal Government has the authority to impose and collect such a tax.
Federal Environment Minister Murray Watt has declined to provide a timeline for the introduction of the levy, citing ongoing discussions with states and territories.
Treasury officials are set to meet with state treasurers and industry experts to finalize a proposal ahead of next week’s productivity roundtable.
Social Services Minister Tanya Plibersek has downplayed the reports, stating that the government’s focus remains on delivering tax cuts and ensuring multinational companies pay their fair share.