Updated EV Road Tax Structure to be Announced in April – Transport Minister

Transport Minister, Loke Siew Fook announced that the Ministry of Transport is currently in the final review stages for the road tax structure for electric vehicles and is expected to be announced in April.

He further stated that the purpose of the review is to set electric vehicle (EV) road taxes at rates below those applicable to internal combustion engine (ICE) vehicles. This initiative also aims to encourage increased usage of EVs nationwide.

The transport minister also emphasized a significant hurdle in the review process, centered on comparing engine capacities of ICE and full EVs. Currently, EV owners enjoy a tax exemption, but prospective buyers remain wary that EV road taxes might exceed those of ICE vehicles once the exemption ends.

He also expressed the government’s commitment to decreasing the road tax for EVs to ensure that EV buyers receive a suitable road tax fee. He also expressed hope that an announcement regarding EV road taxes could be made before the end of April.

The current road tax exemption for EVs, implemented in 2022 and valid until December 31, 2025, operates under a kilowatt-based computation system (correlates with the car power output, the road tax for EVs is calculated based on the combined power rating of their electric motor(s) and different power brackets dictate the base rate, along with any additional progressive rates). In contrast to ICE vehicles, where road tax depends on engine capacity (or we fondly refer to CC).

I believe this a good move as EVs are generally more powerful compared to our ICE counterparts, but no one wants to pay thousands for a car like the Tesla Model 3. What is your take on the potential new EV road tax? Do you think weight will be a determining factor? Comment down below!