States unite in High Court bid to intercept electric-car tax from Federal Government – report

The biggest constitutional fight in 25 years will soon play out in the High Court, according to The Sydney Morning Herald – and it’s all to do with which governments collect taxes from electric car owners.

The case argues against Victoria and its road-user charge, which was brought about by two electric car owners in late 2021 and now has the backing of the Federal Government.

The rest of Australia’s states and territories – apparently keen to intercept the electric-car revenue stream before it gets to the Federal Government – are standing behind Victoria.

Victoria introduced the Zero- and Low-Emissions Vehicles (ZLEV) distance-based charge on 1 July 2021 and imposes a 2.6 cent levy for every kilometre driven by an electric or hydrogen car, and 2.1 cents per kilometre for plug-in hybrids.

The Victorian Government said the levy was designed to replace fuel excise – a 44.2 cents-per-litre tax collected by the Federal Government and then distributed to the states as it sees fit – because electric vehicles were in effect getting a free ride by bypassing this revenue stream.

With the ability to drive with either battery or petrol power, Victorian owners of plug-in hybrids pay both taxes.

Supporting the legal action, the Commonwealth filed a submission which argued the ZLEV charge was a tax on goods – something only the Federal Government can impose.

MORE: Federal Government challenges Victoria’s EV tax in High Court

Attorneys-General from all other Australian states and territories have also intervened in the case, filing submissions in support of Victoria’s defence – arguing the ZLEV charge is a usage consumption tax.

The Australian Trucking Association has backed the plaintiffs, with a view to reduce the financial burden of couriers and trucking operators.

The case will be heard in the High Court in February 2023.