Victoria is set to become the first state in Australia to introduce a tax on electric vehicles.

From July 1, owners of fully electric cars in Victoria will pay 2.5 cents per kilometre and owners of hybrids will be slugged two cents per kilometre.

This will be paid at registration time and is forecast to cost drivers up to $300 each year.

“You’ll be able to take a photograph of your odometer and then download it onto the VicRoads site,” Treasurer Tim Pallas said on Wednesday.

The tax is expected to raise $30 million over four years.

Victoria is set to become the first state in Australia to introduce a tax on electric vehicles. 

Less than one per cent of Australian vehicles are electric but Pallas anticipates uptake will grow as they reach price parity with petrol cars by 2025.

“We’ll get to a point where essentially there’ll be no revenue capacity for the state to manage the use and maintenance of our roads,” he said.

“(That) ultimately leads to a less enjoyable experience using our roads but perhaps more worryingly, it means that our roads will become less safe.”

But not everyone agrees.

“That is a contrived argument. This is a tax grab by the government,” Greens MP Sam Hibbins said.

Australians support subsidy

Polling by the Australian Institute shows 62 per cent agree the government should introduce subsidies for buying electric vehicles, while more than half support a ban on new fossil fuel cars being sold from 2035.

The left-leaning think-tank is dismayed the Victorian government is moving ahead with plans to tax electric vehicles in order to make up lost funds from petrol excise.

Acting Victorian Premier James Merlino said the move is about “fairness” as all cars impact road maintenance and infrastructure needs.

“The majority of Australians actually want incentives to drive the uptake of zero emissions vehicles higher,” the Australia Institute’s Richie Merzian said.

Electric vehicles are estimated to make up just 0.2 per cent of Australia’s total vehicle fleet.

The government predicts 26 per cent of new car sales will be electric by 2030.

The transport sector makes up 18 per cent of Australia’s total greenhouse gas emissions, and is expected to rise through to 2030.

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