The ACT government should start taxing electric vehicle usage to help raise revenue for road upgrades, a high-powered think tank has recommended.
Infrastructure Partnerships Australia is encouraging the Barr government to adopt the reform as part of its 2020-21 budget.
The think tank has made the same pitch to other state and territory governments, using its own research to argue that the continuing decline in fuel excise revenue has created the need to develop a "fairer and more sustainable" model to pay for roads.
Fuel excise, which motorists pay on every litre of fuel at the bowser, has historically provided the federal government with a reliable revenue stream.
But that stream has started to dry up in the past 20 years due to improvements in the fuel efficiency of vehicles and the rise of electric cars, which aren't charged the excise.
In its report, the think tank said the existing model was becoming increasingly unfair, arguing that those who drove older, less efficient cars were effectively subsidising the cost of road upgrades for electric vehicles drivers.
The model was also unsustainable, the report warned.
"Under the current system, more electric vehicles will mean less funding for roads," the report said.
"Over time, this could result in growing congestion, poorer quality transport networks and rising costs for goods and services for all Australians. Road funding will need to be drawn from the broader tax base, taking away resources from critical services such as health and education."
Under one model pitched to the ACT government, the territory would charge electric car drivers for every kilometre they travel, up to a set limit. The revenue raised would be funneled back into road projects, rather than general government revenue.
In 20 years' time, when a massive proportion of the fleet is electric, how are we going to pay for roads?Infrastructure Partnerships Australia chief executive Adrian Dwyer
The total amount charged would be calculated using a car's odometer readings, which would be submitted to the government every six or 12 months.
Governments would set the per-kilometre charge at a rate which meant drivers were paying the same amount that they otherwise would have in fuel excise.
The report includes analysis from accounting firm EY, which showed that even with the new charge, electric cars would be cheaper to own and run than internal combustion vehicles over an eight-year period.
The think tank's chief executive Adrian Dwyer, was confident that the introduction of a road-user charge would not put people off buying or driving electric cars.
"The thing that I would say to anybody that raised the objection that [the charge] would be the disincentive to the uptake of electric vehicles is - what's the alternative?" Mr Dwyer said.
"In 20 years' time, when a massive proportion of the fleet is electric, how are we going to pay for roads?"
Infrastructure Partnerships Australia, which describes itself as a "industry public policy think tank and an executive network", has a board which includes industry heavyweights and senior government bureaucrats.
Federal treasury secretary Steven Kennedy is a board member, although Mr Dwyer said he would soon step down due to his workload.
Mr Dwyer said the think tank's staff, not its board, was responsible for developing its policies.
An ACT government spokeswoman suggested it was more likely that the federal government would consider the proposal.
"Over time, we recognise that the federal government will probably step in to implement mechanisms to ensure these EV users also contribute to the cost and upkeep of road infrastructure," the spokeswoman said.
The spokeswoman said the ACT government's focus was on increasing the uptake of electric vehicles in Canberra.
The government already waives stamp duty on new vehicles and offers a 20 per cent discount on registration fees.
"The government will look at new ways to increase zero emission vehicle uptake through the deployment of more EV charging stations and through the registration system," the spokeswoman said.