The High Court has knocked back the Victorian State Government’s tax on electric and plug-in hybrid vehicles, with the court maintaining the Victorian government is not able to impose the excise.
In a hugely significant ruling for owners of electric vehicles, PHEVs and even hydrogen-powered vehicles, the High Court ruled that the Federal Government, not the state is in a position to impose a road charge of their own.
The case was initially brought on by a pair of electric vehicle owners, Chris Vanderstock and Kath Davies, back in 2021 in response to the state government’s policy that effectively taxed owners of electric and hybrid vehicles at 2.8 and 2.3 cents per kilometre travelled, respectively.
Owners were also reportedly asked to supply photographs of their odometer readings each year, with failure to comply resulting in a charge equating to 13,500km of driving, or even suspension of their registration.
The policy was implemented as electric vehicles skirt around the ever-lucrative fuel excise paid on petrol and diesel here in Australia, with the High Court’s ruling just getting over the line at 4 votes to 3.
Handing down the ruling, the High Court said that the road charge was, in fact, a goods tax, which can only be imposed by the federal government.
Victorian treasurer, Tim Pallas said in response to the ruling that “I don’t think we’ll ever lose sight of the basic proposition that we need to put in place a system that every user of the road basically pay their share of that maintenance.”
Pallas argued that with the added weight of an electric vehicle on the road, they can accelerate the deterioration of public roads.
The timing of the ruling comes after state governments in New South Wales and West Australia announced similar plans for an excise on electric and hybrid vehicles, which will likely have a flow-on effect on their framework and introduction.
Kath Davies said in a statement that “Australia is lagging behind the rest of the world on electric vehicle uptake.”
“Now is not the time to be taxing electric vehicles – it’s the time to be doing everything we can to encourage people to make the switch to cleaner cars.”
