The Federal Chamber of Automotive Industries (FCAI) which represents the majority of new vehicle distributors in Australia is again calling for the federal government to reform taxation on motorists.
The new car industry wants the Government to scrap registration, fuel excise licence fees, luxury car tax and sales tax in favour of a road user charge system which fairly targets all road-going vehicles including fully battery electric vehicles (BEV) which are not captured by excise.
It says the rising cost of living in Australia has reinvigorated debate on this and now is the time for policy makers to examine a broad-based road user charge scheme which it believes would replace a range of outdated and inefficient charges.
The FCAI released a discussion paper on the Road User Charge concept in May 2021.
FCAI chief executive Tony Weber says the transition to road user charging was a progressive step in national tax reform and Governments now have an opportunity to scrap ineffective and antiquated taxes on Australian motorists.
“Since the release of the FCAI’s discussion paper, some State Governments have announced plans to introduce a road user charge for the owners of electric vehicles as part of their zero emission strategies,” Weber says.
“Our view is that Governments can take this further and apply a road user charge to all vehicles, regardless of their engine type.
“A road user charge can replace a myriad of charges such as registration, fuel excise licence fees, luxury car tax and sales tax. The reduction in complexity also presents an opportunity to reduce the bureaucracies required to administer these, providing additional economic benefit.
“State and Territory Governments are beginning to adapt to the changing nature of mobility in Australia, including the rise of electric vehicles that do not pay fuel excise. Applying RUC more broadly and scrapping taxes like fuel excise and the luxury car tax will ensure that all motorists are paying an equitable amount to use Australia’s road network.
“The discussion paper released by the FCAI outlines the opportunities and pathways that are available to Governments for this type of taxation reform. Clearly the details need to be carefully considered to ensure any scheme considers the application of equity for motorists across the country.
“This is particularly important when considering rural and regional travel, the Australian lifestyle and our tyranny of distance,” he says.
Weber says the automotive manufacturers want to work alongside Governments that have the courage and foresight to address this issue.
“We need this reform to move Australia’s road tax system from last century and ready it for the future of motoring. Australians want a future that can provide clarity, simplicity, fairness and value to their wallet,” he says.
Join the conversation