Vanderstock v Victoria Explained in Plain English
What the High Court’s 4–3 decision on Victoria’s electric vehicle road-user charge changed, and what it did not decide about Australian toll roads.
The 60-second answer
On 18 October 2023, the High Court ruled that Victoria’s kilometre-based charge on electric, hydrogen and plug-in hybrid vehicles was invalid.
The Court decided, by a 4–3 majority, that the charge was a duty of excise under section 90 of the Australian Constitution. Section 90 gives the Commonwealth Parliament exclusive power to impose duties of customs and excise, meaning a State cannot impose a tax that falls within that category.
The decision was important because the majority confirmed that certain State taxes imposed when goods are used or consumed can be duties of excise.
However, the High Court did not decide that all road-user charges, registration fees or toll roads are unconstitutional. Those questions require separate legal analysis.
Case at a glance
Case: Vanderstock v Victoria
Citation: [2023] HCA 30
Court: High Court of Australia
Decision date: 18 October 2023
Plaintiffs: Christopher Vanderstock and Kathleen Davies
Defendant: State of Victoria
Result: 4–3 decision for the plaintiffs
Law challenged: Section 7(1) of the Zero and Low Emission Vehicle Distance-based Charge Act 2021 (Vic)
Constitutional provision: Section 90 of the Australian Constitution
Final order: Section 7(1) was invalid and Victoria was ordered to pay the plaintiffs’ costs
What was Victoria’s electric vehicle charge?
Victoria introduced a distance-based charge for registered operators of zero and low-emission vehicles.
For the 2021–22 financial year, the charge was:
2.5 cents per kilometre for electric and hydrogen vehicles
2 cents per kilometre for plug-in hybrid electric vehicles
The amount was calculated using the distance travelled during the financial year.
Importantly, the law was not limited to a particular toll road, bridge or tunnel. Its definition of a “specified road” effectively covered all public roads throughout Australia.
The charge became a debt owed to the State of Victoria.
Who challenged the charge?
Christopher Vanderstock and Kathleen Davies were registered operators of zero or low-emission vehicles. They received invoices for the charge and paid them.
They then challenged the validity of section 7(1) directly in the High Court.
Their argument was that the charge was a duty of excise. If that was correct, Victoria did not have constitutional power to impose it because section 90 gives that taxing power exclusively to the Commonwealth.
The Commonwealth Attorney-General supported the plaintiffs. The other States and Territories supported Victoria.
What does section 90 of the Constitution say?
Section 90 gives the Commonwealth Parliament exclusive power to impose duties of customs and excise.
Customs duties generally apply to imported goods. The meaning of a duty of excise has been considerably more difficult and has produced a long history of divided High Court decisions.
In plain English, an excise is an inland tax on goods.
The difficult question is deciding when a charge is properly characterised as a tax on goods, rather than a tax on a person, an activity or a service.
That was the central issue in Vanderstock.
What did the High Court have to decide?
The legal question was whether Victoria’s charge was properly characterised as a tax on zero and low-emission vehicles.
Victoria accepted that the charge was a tax. It did not argue that the charge was simply a fee paid in return for the State providing a particular road.
The dispute was therefore focused on whether that tax was a duty of excise under section 90.
What did the majority decide?
Chief Justice Kiefel and Justices Gageler and Gleeson delivered joint reasons. Justice Jagot agreed with the result in separate reasons.
Together, they formed the four-judge majority.
The majority held that an excise is an inland tax on goods. To determine whether a tax has that character, the Court considers two main questions:
Does the tax have a close relationship with the production, manufacture, sale, distribution or consumption of particular goods?
Is the tax of a kind that tends to affect those goods as items of production or commerce?
The Court looks at the legal form and practical operation of the tax. It is not limited to the name used by Parliament or the exact point at which payment becomes due.
Why was the charge a duty of excise?
The majority found a close relationship between the charge and the use of zero and low-emission vehicles.
The charge applied when those vehicles were driven, was calculated according to the distance travelled and could continue throughout a vehicle’s useful life.
The majority also considered the commercial effect of the charge. An ongoing cost associated with owning and using a vehicle could influence what consumers were willing to buy. The charge therefore had a natural tendency to affect demand for zero and low-emission vehicles.
That was enough for the majority to characterise it as a tax on goods and therefore a duty of excise.
Because Victoria could not constitutionally impose that duty, section 7(1) was invalid.
What legal rule did Vanderstock change?
Before Vanderstock, the 1974 decision in Dickenson’s Arcade Pty Ltd v Tasmania had been treated as authority that a tax imposed at the consumption stage was not a duty of excise.
The majority reopened and overruled that part of Dickenson’s Arcade.
The important change is that a State tax does not automatically escape section 90 simply because it is imposed after a product has been sold to its consumer.
A qualifying tax imposed on the use or consumption of goods may now be an excise.
That does not mean every government charge involving goods is an excise. The charge must first be a tax, and it must then have the necessary relationship with goods and their treatment as articles of commerce.
Why did three judges dissent?
Justices Gordon, Edelman and Steward disagreed with the majority.
Although their reasoning differed, the dissenting judges generally favoured a narrower understanding of excise and placed greater weight on the existing line of authority.
Their concerns included:
whether a tax imposed on use after a vehicle had been purchased was truly a tax on goods
whether the charge had a sufficiently direct economic effect on the market for vehicles
whether Dickenson’s Arcade should have been overruled
the uncertainty a broader definition of excise could create for State taxation powers
They would have upheld the Victorian charge.
The majority decision is nevertheless the binding legal result.
Why does Vanderstock matter?
The decision expanded the practical reach of section 90.
Following Vanderstock, a State cannot necessarily avoid the constitutional restriction by waiting until goods have been purchased and then taxing their ownership, use or consumption.
The case also confirmed that courts will examine the substance and practical operation of a charge. Calling something a “levy”, “charge” or “road-user contribution” does not settle its constitutional character.
Governments designing future vehicle and road-user charging systems must now consider:
whether the payment is genuinely a fee for a service or facility
whether it is legally a tax
what event creates the liability
how closely the charge relates to particular goods
whether it affects the price, demand or commercial market for those goods
Did Vanderstock make toll roads unconstitutional?
No. The High Court did not determine the constitutional validity of ordinary toll roads.
Victoria’s charge applied broadly to kilometres travelled on effectively all public roads. It was not a payment for access to one identified motorway, bridge or tunnel.
A conventional toll may be characterised differently because it is connected to the use of a particular piece of infrastructure. It may be argued that the payment is consideration for access to that facility rather than a tax.
That distinction was not decided in Vanderstock. Because Victoria accepted that its charge was a tax, the Court did not need to decide where the dividing line lies between a tax and a genuine fee for using a road.
The name given to a charge is not conclusive. Any challenge to a toll scheme would require close examination of the legislation, the payment structure, the recipient, the service provided and the scheme’s practical operation.
Why is Robin Hood Tech examining this decision?
Robin Hood Tech is not claiming that Vanderstock has already invalidated Australian toll roads.
Our question is narrower.
When a compulsory road charge is established under State law, continues for decades and produces revenue beyond the direct cost of an individual journey, is it always properly characterised as payment for a service? Or could aspects of the arrangement operate as taxation?
Vanderstock makes that question worth examining, but it does not provide an automatic answer.
Read our separate analysis of Vanderstock, section 90 and Australian road tolls.
Frequently asked questions
What did Vanderstock v Victoria decide?
The High Court decided that Victoria’s distance-based charge on zero and low-emission vehicles was a duty of excise. Because section 90 reserves the power to impose duties of excise to the Commonwealth, the Victorian provision was invalid.
Who won the case?
Christopher Vanderstock and Kathleen Davies won by a 4–3 majority.
What is a duty of excise?
Following Vanderstock, an excise is an inland tax on goods. Whether a tax fits that description depends on its relationship with the production, sale, distribution, use or consumption of goods and its tendency to affect those goods commercially.
Why was Victoria’s EV charge unconstitutional?
It was a State tax closely connected to the use of particular vehicles, and the majority found that it had a tendency to affect demand for those vehicles. That made it a duty of excise that Victoria could not impose.
Did the decision ban every State road-user charge?
No. Whether another charge is valid depends on its particular design and legal character. A genuine fee for a service or facility may be treated differently from a tax on goods.
Did Vanderstock make toll roads unconstitutional?
No. The case did not decide whether an ordinary toll for using a specified road, bridge or tunnel is a tax, an excise or a fee for access to infrastructure.
Does the decision cancel toll notices, fines or toll debts?
No. Vanderstock does not automatically invalidate a toll notice, administrative charge, penalty or debt. Those matters are governed by their own legislation and circumstances.
What precedent did the High Court overrule?
The majority overruled Dickenson’s Arcade Pty Ltd v Tasmania to the extent that it established that a tax on the consumption of goods could not be a duty of excise.
What is the case citation?
The official citation is Vanderstock v Victoria [2023] HCA 30.
Official sources
Related reading
Written by Adam Littlefield, Robin Hood Tech
Last reviewed: 23 September 2026
Legal disclaimer
This page provides general information and commentary. It is not legal advice. Vanderstock v Victoria did not determine the validity of any particular toll road, toll notice, enforcement charge or debt. Anyone affected by a legal deadline, enforcement action or substantial liability should obtain advice about their individual circumstances.