Electric-car owners in South Australia can breathe a sigh of relief, with the abolition of a controversial road-user tax.

The per-kilometre charge for electric cars – in addition to vehicle registration fees – was intended to make up for the revenue lost from fuel excise, a portion of which goes into road funding.

In recent days, the South Australia Parliament has voted to repeal the pay-per-kilometre tax – which was due to come into force in July 2027, or when electric vehicles reached 30 per cent of new-car sales in the state – after initially delaying its implementation by five years.

The tax would have forced drivers of electric cars to pay 2.5 cents for every kilometre, in an effort to recuperate lost revenue from the fuel excise, which is collected for each litre of petrol, LP gas, and diesel sold.

« We want more South Australians making more environmentally-friendly choices, not putting in barriers that dissuade them, » South Australian Minister for Transport and Infrastructure Tom Koutsantonis said in a media statement in May 2022, at the announcement of the proposed changes.

« The feedback we received from the community was overwhelming, the [previous government’s] decision to introduce this tax would have reduced community uptake [of electric cars]. »

But despite publicly admonishing the road-user tax, behind closed doors South Australia continues to support the flexibility to implement such a tax.

The Victorian road-user tax is currently before the High Court, in what is said to be the biggest constitutional battle in 25 years.

South Australia’s Attorney-General submitted an argument in defence of the tax to the High Court on 16 February 2023, despite repealing its own road-user tax in the same week during a parliamentary sitting.

The case will ultimately decide what level of government can collect the tax dollars and how they are distributed.