Victorian Zero and Low Emission Road User Charge Tax RemovedBack

On November 13, 2023
Update on the user charge tax relating to EV and PHEV has been announced for Victorian Drivers.


Since the beginning of the financial year in 2021, the Victorian State introduced a ‘user charge’ on all registered drivers of electric, hydrogen and plug-in hybrid electric vehicles in Victoria. This tax was calculated upon kilometres driven. The charge had been introduced as the ZLEV drivers now are not paying the regular fuel excise imposed on all other internal combustion vehicles.

The charge had been challenged on the basis that it is ‘constitutionally invalid’ whereby the Commonwealth has exclusive power to impose duties of customs and excise, not the state. The challenge was then backed by the Commonwealth Attorney-General and Australian Trucking Association.


Two years since the beginning of this tax on ZLEV drivers, the High Court has now deemed this to be in contravention with section 90 of the Australian Constitution which in layman’s terms; the tax has now been removed.


The future looks interesting for states that are looking to follow Victoria’s charge such as Western Australia and New South Wales, now that the charge has been deemed invalid, it would seem near certain that the two states will pull away from that ideal.


VicRoads and the Victorian Government has removed all obligation going forward on the ZLEV owners to submit their odometer readings and settle outstanding charges. There may be potential refunds for those who have paid this charge since 2021 but this has not been confirmed at this early stage.


As the country moves towards electric at an increasing rate, this removal of the user charge for Victorians may open doors to those opposed to the idea due to this tax.


If you would like to learn more about how a Plug-In Hybrid or Electric vehicle could save you thousands with its unique FBT exemption, contact our friendly Novated Lease Experts for an in-depth break down.

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