Electric Vehicle & Hybrid Tax in Victoria

VicRoads implements road user tax commencing 1st July 2021

From next month, electric vehicle owners in Victoria must send the state’s highway authority photos of their car’s odometer to record how far they’ve travelled or face having their rego cancelled.

On July 1, the Victorian Government’s controversial tax on EVs comes into force – with VicRoads this week revealing the way it plans to charge owners will be by requiring an odometer reading and supporting photo as evidence each time the vehicle’s registration is renewed.

What’s more, anyone caught trying to pull a fast one by providing a false reading could end up with 60 penalty units against them and an almost $10,000 fine. For businesses the punishment rises to 300 penalty units or a $50,000 fine.

The Department for Transport said “failure to comply with the scheme may result in penalties, including the suspension and cancellation of a vehicle’s registration”.

EV owners will have to pay 2.5c/km from July 1

The scheme has been heavily criticised – not just for its charges, but also on the basis of how it records the distance travelled in a year.

Instead of utilising a system similar to pink slips in New South Wales, where vehicles are independently inspected every 12 months and the odometer reading is recorded, VicRoads will send a request to owners for a photo of the vehicle’s odometer reading when they renew their registration.

Speaking to WhichCar, Hyundai Australia criticised the immediate implementation of the EV tax, saying there’s a need for one further down the road but now is not the right time.

“As cars become more efficient and use less fuel – or no fuel at all in the case of EVs – the Government’s income from fuel excise will drop away,” said a Hyundai spokesman.

“So at some stage in the future we will need to consider road user charging more broadly – on a national basis, for all vehicles using the roads.

“Until such a national strategy is developed, we don’t believe now is the right time to tax zero-emission vehicles.

“Road user charging would be better timed after incentives are in place to encourage public adoption of EVs. We see government incentives working well in most advanced nations across the world, as a key component of climate change policy.

“We are encouraged by the Victorian Government’s incentives package for EVs and the accompanying investment in EV charging infrastructure.

“Once incentives are in place and we see consumer uptake of EVs accelerate, the time will be right to look at road user charging more broadly.

“Until then, we don’t advocate taxing the most advanced and efficient vehicles on the road.”

A new subsidy scheme for new EV buyers has also recently been introduced by the Victorian Government, taking $3000 off the price of a fully-electric or hydrogen car at the dealer, though this too has come under fire for being “confusing”, with some dealers applying the discount while others aren’t.

The Department for Transport has defended the road user charge, claiming it is necessary to claw back money from the subsidy scheme.

“We’re taking bold steps to achieve net zero emissions in Victoria by 2050,” a spokesman said.

“We know transport is one of the state’s biggest emitters – and through our Zero Emissions Vehicle Roadmap, we’re ensuring Victoria is a leader in the uptake of zero-emissions vehicles by making them accessible to more Victorians.

“Our $100 million support package for zero-emissions vehicles includes a new vehicle subsidy so more people can access a new, cleaner car, increased charging infrastructure and initiatives to increase corporate fleet purchases.

“These investments have been made possible by a zero and low-emissions Road User Charge which will ensure all road users contribute their fair share towards the cost of Victoria’s road network as we work to make our roads cleaner.”