Electric car road user charges nearing for Australian drivers
Electric vehicle owners in Australia will soon be made to pay road-user charges in place of the fuel excise tax, as federal and state governments grapple with ensuring EV drivers contribute their fair share to road upgrades.
According to reports, Federal Treasurer Jim Chalmers is working with state governments to fast-track plans for a new road-user charge for EV owners, who until now have been able to circumvent the 51.6 cents per litre fuel excise paid at the bowser by petrol and diesel motorists.
Funds from the excise have traditionally contributed to important road upgrades and safety measures nationally.
Chalmers and state treasurers have gathered at the Infrastructure Partnerships Australia road-user charging forum in Sydney this week. Also in attendance are members from the Productivity Commission, Transurban and the Australian Automobile Association, who will hold high-level talks on how a new road user charge could work ahead of next week’s economic roundtable in Canberra.
Pressure is mounting on the Federal Government to take action, amid increasing popularity for electric vehicles in Australia.
Fed up with the delay, the Victorian government introduced its own 2¢-per-kilometre charge, but this was ruled unconstitutional by the High Court in October, 2023. NSW has legislated a charge to begin on July 1, 2027, or whenever 30 per cent of new cars sales are electric, whichever comes first.
Based on a planned NSW road user scheme, a national rollout would depend on user mileage but might cost between $300 and $400 a year. Those figures would net a forecast $73 million in revenue from a road-user charge 2027-2028 financial year – increasing to $141 million the following 12 months.
Victorian Treasurer Tim Pallas told The Australian newspaper that electric vehicles are “heavier and do more damage to the road network as a consequence than do internal combustion engine vehicles”.
“But there’s an environmental plus to electric vehicles,’’ he countered.
“So getting that balance right was key to us. The way we figured it, (a road-user charge) came in about half of the equivalent costs of fuel excise and that’s not counting the incentives the state was putting into the vehicle purchase or registration for low-emissions vehicles.”
The Productivity Commission has urged the Albanese government to take action over declining fuel excise revenue amid spiralling rising maintenance costs.
The Treasurer has flagged his intention to shake-up the current system, raising the idea with business leaders in February before readdressing the issue in June.
