Road user charge reform and the political shift in interest in Australia: Some thoughts to contemplate

The 2024 electric vehicle distance-based charge introduced in Victoria, Australia, to recognise that such vehicles do not pay fuel excise tax, led to a high court challenge in which it was deemed unconstitutional for a State to introduce such a charge, which is the responsibility of the Federal government (through legislation amendment). This loss of fuel excise as a tax (not a charge) on electric cars whetted the appetite of the Federal Government to place road user charging on a round table in August 2025. We now have elevated the topic right into the political sphere where any change will require such support, and it opens up an opportunity to not only consider the fuel excise issue per se but the broader agenda on road pricing reform. • This short topical issues paper sets out a new political era for road user charging regime. • The focus is on the political buy as a result of concerns over loss of fuel excise aswe switches to electric vehicles. • A staged approach to reform is required to ensure the changes can occur with more detailed repricing. • A distance-based charge for all cars when removing fuel excise, vs just for EVs if we retain the fuel excise on ICEs.