Vanderstock v Victoria

In *Vanderstock v Victoria*, the High Court of Australia considered a constitutional challenge to Victoria's Zero and Low Emission Vehicle Distance-based Charge Act 2021 (Vic) ("ZLEV Charge Act"). The dispute arose because the Act purported to oblige registered operators of zero or low emission vehicles to pay a charge for the use of these vehicles on roads within Victoria and elsewhere in Australia. The question of law was whether this charge constituted a duty of excise within the meaning of section 90 of the Australian Constitution, which grants the Commonwealth Parliament exclusive power to impose such duties.

The central legal issue before the Full Court was whether section 7(1) of the ZLEV Charge Act was invalid for imposing a duty of excise. This required the Court to determine the scope and operation of section 90 of the Constitution, particularly in relation to taxes imposed at the point of consumption. The Court was asked to consider whether the definition of a duty of excise, as previously stated in cases like *Capital Duplicators Pty Ltd v Australian Capital Territory [No 2]* and *Ha v New South Wales*, was exhaustive or merely descriptive, and whether the ZLEV charge, as an inland tax on goods imposed at the stage of consumption, answered the description of a duty of excise. The Court also considered whether *Dickenson's Arcade Pty Ltd v Tasmania* should be reopened and overruled.

The High Court reasoned that the ZLEV charge, by imposing a liability on the use of a vehicle, which is a good, at the point of consumption, fell within the constitutional definition of a duty of excise. The Court held that the previous characterisation of duties of excise as taxes on the production, manufacture, sale, or distribution of goods was too narrow. Instead, the Court adopted a broader understanding, focusing on whether the tax had the "natural tendency" to affect goods as articles of commerce, and whether it was imposed at a stage that had a "close relation to goods" and was not a tax on the consumer as such. The Court concluded that the ZLEV charge, being a tax on the consumption of a good (the vehicle's use), was a duty of excise.

The Court answered the first question in the affirmative, finding that section 7(1) of the ZLEV Charge Act is invalid as it imposes a duty of excise within the meaning of section 90 of the Constitution. The Court also ordered that Victoria pay the costs of the proceeding.