22 May, 2024
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High Court rules on future of electric vehicle charges

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Australian motorists will find out how they could be taxed for driving electric and hybrid vehicles when the High Court rules on a case involving Victoria’s road user tax on low-emission vehicles.

A judgment in the case against the Victorian government, launched by two electric vehicle drivers in 2021, is due to be handed down on Wednesday morning.

The case will determine whether the Victorian government can charge electric, hydrogen and plug-in hybrid vehicle owners a fee for each kilometre they travel, or whether the road user charge is a tax that can only be imposed by the federal government.

The outcome is expected to affect more than just Victorian drivers as attorneys-general for all states and territories intervened to argue for the right to tax road users and two states have announced plans to do so in 2027.

Victorian drivers Chris Vanderstock and Kath Davies launched the lawsuit shortly after the state government introduced its Zero and Low-Emission Vehicle road user charge.

The law charges electric and hydrogen vehicle owners 2.8 cents for each kilometre they travel during the year and plug-in hybrid vehicle owners 2.3 cents for each kilometre.

Hybrid vehicles are exempt.

Motorists are required to submit photographs of their vehicle odometer to the state government each year and, if they fail to, can be charged for driving 13,500km or have their registration suspended or cancelled.

But lawyers for Mr Vanderstock and Ms Davies argued the road user charge was a consumption tax that replaced the federal fuel excise tax and, according to the Constitution, could not be collected by state governments.

Equity Generation Lawyers senior associate David Hertzberg said  the plaintiffs hoped the lawsuit would prompt a new approach to road user charges.

“One of the implications of this case, if we are successful, is that it might pave the way for coherent, consistent and fair national policy to encourage the (transport) transition,” he said.

While Victoria is the only state to charge low-emission vehicle owners so far, NSW and Western Australia have announced plans to introduce similar schemes in July 2027.

The High Court decision also comes weeks after Victorian Ombudsman Deborah Glass released a report into the state’s ZLEV scheme, saying those administering it were inflexible in dealing with complaints and penalties charged to drivers were not outlined in legislation.

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