Road tax

Road tax, known by various names around the world, is a tax which has to be paid on, or included with, a motorised vehicle to use it on a public road.

All states and territories require an annual vehicle registration fee to be paid in order to use a vehicle on public roads; the cost of which varies from state to state and is dependent on the type of vehicle. The fee is known colloquially as 'rego' (pronounced with a soft g, short for registration). Queensland road tax is based on the number of cylinders or rotors the vehicle's engine has. There is also a small traffic improvement fee. New South Wales road tax is paid based on the vehicle's tare weight.

Passenger cars pay a registration fee based on the engine displacement and power output (degressive towards 2014 (66% in 2012, 33% in 2013, 0% in 2014) and environmental criteria such as CO₂ g/km output (increasingly towards 2014). The more CO₂ g/km the car produces, the higher the fee will be.

Every year, the plate number owner has to pay the annual road tax contribution. This tax is based on the engine displacement (0-799cc = fiscal HP 4, above 800cc each 200cc is one class higher). Due to CO₂-based regulations, diesel cars with above average displacement (>2,000cc) are favoured, and petrol cars with bigger displacements are put at a disadvantage). A supplementary annual fee has to be paid for cars that run on LPG/CNG (0-799cc: €84/year, 800–2,499cc; €148/year and >2,500cc: €208/year) to compensate financial loss for the state due to the absence of excise at the pump.

In Brazil, the states may collect an annual Vehicle Licensing Fee (Taxa de Licenciamento Veicular) which has a fixed value for each vehicle category determined by each state. In addition, each state may impose a Vehicle Property Tax (Imposto sobre a Propriedade de Veículos Automotores), with a rate up to 4%.

The Costa Rican car property tax, commonly referred to as Marchamo, is among the highest in Latin America, with rates that can go up to 3.5% of the fiscal value of the vehicle yearly. When compared to the Costa Rican minimum wage (₡331,516.22 a month, equivalent to US$597.33), the tax on an average US$15,000 (₡8,600,000) car can be ₡302,000 (US$525), or 80% to 120% of a month's pay. Even though Costa Ricans receive a yearly bonus equivalent to a month's salary, the property tax negates this for most car owners, which has led to calls for tax law reform.

Opponents to the car property tax argue that common cars already pay 100% tariff when imported, meaning that a car in Costa Rica is twice as expensive as in the country of origin. Additionally, gas refills include 65% fuel tax. Owning a car that would cost US$7,500 to purchase (in the United States) for seven years can result in the owner paying up to US$29,595 in total taxes (around US$4,227.85 a year). The Ministry of Finance also has the right to step up the fiscal value of a car, effectively a negative depreciation.

The yearly motor vehicle tax (Mootorsõidukimaks) was implemented in 2025. Vehicles first registered at least 20 years ago to the date are only taxed at the flat basic rate of €50 per year, tax for newer vehicles is in addition to the €50 calculated based on CO₂ emission per WLTP standards (€3 per gramme between 118-150 grammes, €3.50 per gramme between 151-200 grammes and €4 per gramme for over 201 grammes) and GVWR (€0.40 for every kilogramme over 2000 kilogrammes, up to €400). If the CO₂ emission is instead given in NEDC standards, the price based on emission will be multiplied with a coefficient of 1.21. If the CO₂ emission is not given, then the tax rate will be calculated by adding the engine power in kilowatts multiplied by 0.29 and the vehicle's curb weight in kilogrammes multiplied by 0.07.