The state's biggest industry body has called on the state government to continue to provide incentives to rail freight operators, to encourage them to shift freight off road.
The Mode Shift Incentive Scheme provides funding to four rail operators, with terminals at Dooen, Mildura, Tocumwal. NSW, and Warrnambool.
The MSIS is due to end on June 30, this year.
In its state budget submission, the Victorian Chamber of Commerce and Industry is calling on the government to "provide sustained funding for the MSIS to provide regional exporters and logistics companies more certainty in the transition from road to rail".
VECCI chief executive Paul Guerra said the financial health of the state was under pressure and it was time to transform the approach to growth, while containing costs.
"Efficient transportation of people and goods is critical for a thriving state," he said in the submission.
"Mobility of products and people around Victoria must be seamless, without delays and congestion, to ensure our state's economic growth into the future."
Freight movement and increased the productivity of the supply chain network was dependent on building capacity now for future demands, including through the increased use of rail freight.
The VECCI has also called for the government to prioritise a decision on the Victorian Intermodal Freight Terminal's site at the Western Interstate Freight Terminal (WIFT) in Truganina as soon as possible to provide certainty to operators and industry.
It also wants to see the WIFT connected directly to the Port of Melbourne, via a dedicated train line to the Swanston Dock in the short-term, and Webb Dock in the longer-term to build productivity in the Australian supply chain and improve capacity through the Port of Melbourne.
Meanwhile, the Mildura Rural City Council has joined calls for the government to scrap proposals for a new tax on truck freight, to the port.
Mildura mayor Liam Wood said the new tax would be a financial hit for the broader community, commodity groups and local growers.
"Given the ongoing need for major upgrades to the rail network, including completion of the Murray Basin Rail Project, our region is still heavily reliant on road transport, meaning we could be among regions hardest hit by this new tax," Cr Wood said.
"This means increased costs for our local transport operators, which will then be passed on to local growers and businesses transporting goods in and out of our region.
"And of course, it's our broader community who will then feel the impacts of these increased costs at the checkout."
He called on the government to provide more information on how income from the proposed tax would be spent, the impact on regional areas, and how much of it would be invested in road or rail upgrades.
Victorian Transport Association chief executive Peter Anderson said he had not heard any more about the proposal, although industry insiders said it was floated by the Department of Transport and Planning with the sector to seek its reaction.
"If they ever wanted to do it, it was never going to work," Mr Anderson said.
"I didn't think it was ever alive."
A DTP spokesman said no decision had been made and consultations were ongoing.