Transurban Corporate Report FY25 Introduction – About this report
Brisbane, Queensland
Sydney, NSW
Road-user charging In Australia, the Federal Government estimates that fuel excise will make up 3.9% of total tax collections in 2024-25, down from 7.4% five years ago. 3 To offset the funding shortfall, road user charging has been recommended by many industry experts as a fairer and more sustainable means to generate revenue. In the US, states including Oregon, California and Utah and a coalition of states on the east coast (known as the Eastern Transportation Coalition), are trialling road-user charging systems based on vehicle miles travelled as an alternative to gas taxes. Transurban has long been an advocate for road-user charging and partnered with the Eastern Transportation Coalition to assess the feasibility of transitioning to a distance- based road user funding approach. In Australia, the Federal Government has acknowledged that declining fuel revenue is a challenge that needs to be addressed through tax reform including a charge for electric vehicles. 3 It is one of the options the Government is expected to propose as a part of its review into the nation’s productivity.
In Australia, the take up of EVs declined in the first quarter of 2025 to a two-year low, with plug-in hybrids gaining in popularity. 1,2 The rise in hybrid sales follows the Australian Federal Government introducing the New Vehicle Efficiency Standard, which came into effect on 1 January 2025. The Standard aims to reduce transport emissions and incentivise car manufacturers to supply more fuel- efficient and low-emission vehicles such as hybrids and EVs. The legislation applies to new car sales and gives automakers an annual emission ceiling to help Australia reach its net zero by 2050 emissions target. Targets will become stricter over time. Recent Transurban research found that while 37% of respondents in the Australian cities surveyed would like for their next car to be an EV, upfront costs are still considered the largest barrier to take up.
However, implementing a road-user charge for EVs appears challenging after the Victorian Government was forced to repeal its tax, which was deemed unconstitutional by the Federal High Court in 2023. The NSW Government is planning to introduce an EV road usage charge in July 2027 – or when EVs comprise 30% of all new vehicle sales – whichever comes first. In New Zealand, the government recently announced legislative changes to transition all 3.5 million light vehicles from a petrol excise duty to electronic road-user charges. As part of the change, road-user charge licences will shift from paper to digital, enabling broader use of in-vehicle devices and flexible payment models. The government will open the system to third- party providers by 2027, encouraging innovation and user-friendly solutions. Transurban continues to stay actively engaged on this issue, contributing to policy discussions and exploring technology solutions in Australia, New Zealand, and North America.
1 Drive, Australian electric car market wanes as more buyers flock to hybrids and plug-ins, 6 February 2025 2 The Guardian, Electric vehicle sales hit two-year low in Australia as hybrid cars boom, 22 May 2025 3 The Financial Review, Chalmers flags action on EV road user charge, 7 February 2025
10
Made with FlippingBook Digital Publishing Software