Future of Victorian electric vehicle tax up in the air
A wave of new EVs hitting Australia is pushing down prices, but many motorists aren't convinced. Photo: Getty
Victorians are set to find out whether they’ll have to continue paying tax on electric vehicles under a case that could change how states raise revenue.
Kath Davies and Chris Vanderstock have taken the tax all the way to the High Court, arguing it’s unconstitutional.
The pair say a tax on electric vehicles is not only counter-intuitive for their take-up, but an overreach in an area where only the Commonwealth can impose an excise.
“I want to see more climate action, not less,” Ms Davies said outside the High Court on Tuesday.
“This tax, in my mind, is a roadblock to reducing emissions and getting better air quality.”
The case comes down to what the definition of an excise is in the constitution and what taxes states have the power to enact.
Lawyer David Hertzberg says the landmark case will have implications for the division of power between the Commonwealth and the states.
“If our clients are successful, it will mean Victoria’s electric vehicle tax is invalid and will likely also prevent other states from implementing similar legislation,” he said.
But Victorians are unlikely to know whether they’ll get a refund if the tax is ruled unconstitutional anytime soon.
“It depends on a number of factors and we’ll have to cross that bridge when we get to it,” Mr Hertzberg said.
He also rubbished the suggestion of any hole being blown in the state’s budget.
“The fuel excise is led by the federal government, not the states, so there’s no shortfall as far as Victoria is concerned,” he said.
“This tax is just a cash grab.”
Victoria charges electric vehicle owners 2.6 cents per kilometre, and plug-in hybrid owners 2.1 cents, with users submitting odometer readings annually.
A similar tax in South Australia was repealed last week after being described as “backwards-thinking”.
NSW and Western Australia have flagged an electric vehicle tax from 2027.
Queensland, Tasmania and the two territories haven’t outlined plans for an electric vehicle tax but have written to the High Court to support Victoria’s position.
The case will be heard before the High Court from Tuesday to Thursday.
– AAP