Plans are reportedly being fast-tracked for the introduction of an electric vehicle (EV) road tax. Photo: James Coleman.
Electric vehicle owners look set to be hit with a road-user’s levy sooner rather than later, with reports that the Federal Government is fast-tracking plans for a new tax.
EV drivers don’t pay the fuel excise that comes with buying petrol and diesel, and therefore don’t contribute to the cost of road upgrades.
Treasurer Jim Chalmers wants to change that and has flagged the likelihood of an EV levy.
The Productivity Commission is also pushing for it.
Reports in The Australian on Monday (11 August) suggest the issue is fast becoming a matter of priority and will form part of next week’s productivity roundtable.
Ahead of that Canberra gathering, the Federal Government is meeting with state treasurers and industry experts to nut out a proposal.
Petrol and diesel currently attract a fuel excise of 51.6 cents per litre at the bowser, which the federal government collects.
There have been roadblocks to states implementing EV levies, with Victoria’s having to be scrapped when a High Court ruling upheld a challenge that it was only the Federal Government that could impose and collect such a tax.
Some other states have plans to introduce a road-user levy, either directly or indirectly, aimed at EV drivers.
The ACT Government, however, has written to the Federal Government ahead of the productivity roundtable to suggest that a national road-user charge that targets all drivers is needed.
The ACT says the levy should be administered and collected nationally for the benefit of state and territory roads.
It also wants the feds to distribute mining royalties among the states and territories for a “more equal and sustainable footing” across jurisdictions.
Better data sharing between the Federal Government and all states and territories; harmonisation of vocational pathways from tertiary qualifications; and an accelerated plan for the use of artificial intelligence were also on Chief Minister Andrew Barr’s wishlist for the roundtable’s agenda.
The Australian Automobile Association (AAA) would also like to see a national approach to any changes to the way motorists are taxed.
Its most significant demand is that all revenue collected from a road-user’s levy, which includes EV drivers, must be directed exclusively to road upgrades.
The AAA’s suggestion is for charges to be calculated according to distances travelled.
That’s problematic, however, as the Constitution forbids the Commonwealth from imposing taxes that could have a discriminatory impact on one or more states.
Applying taxes according to distances being driven could be easily interpreted as discriminatory against some states and territories.
Environment Minister Murray Watt shed little light on the government’s plans for an EV levy, declining to say how soon the impost might be introduced.
“I wouldn’t want to jump ahead of any sort of decision-making with that,” Senator Watt told the ABC.
“It’s no secret that we’ve said previously we’ll work with the states and territories on this matter.
“There’s obviously some reporting about that today in some of the newspapers.
“You’d be aware that there was a High Court decision which really raised this issue front and centre, and ever since then, we’ve been working with the states and territories.
“But it’s probably premature to say exactly what will occur.”
Social Services Minister Tanya Plibersek has also downplayed reports, saying states have been discussing the prospect of an EV levy for some time.
“It’s no secret that as the number of petrol vehicles and diesel vehicles goes down, the take from fuel excise decreases,” she said.
“That means less money for building and maintaining roads.
“I’m sure the Treasurer will be interested in the discussion today, but the Prime Minister has made clear that our tax priorities are delivering on the tax cut for every Australian that we’ve promised and making sure that multinational companies pay their fair share. So that’s our focus.”
Ms Plibersek told Channel Seven that an EV levy was a “long-term discussion” and that “nothing is changing tomorrow”.
