Australia's EV Tax Review: What the Road-User Charge Means for Electric Car Buyers

The federal government is reviewing the EV fringe benefits tax exemption and considering a road-user charge for electric vehicles. Here's what it means for buyers in 2026 and beyond.

The federal government is reviewing the existing fringe benefits tax (FBT) exemption for electric vehicles, and a road-user charge (RUC) for EVs is looming. For buyers who switched to electric to save money, the changes could reshape the financial case for going green. What Is Being Reviewed? Currently, EVs priced under the luxury car tax threshold are exempt from FBT when used as part of a novated lease or salary sacrifice arrangement — a significant saving for many buyers. The government is now assessing whether this exemption should continue as EV uptake grows, and whether a per-kilometre road-user charge should replace the fuel excise that EV drivers don't pay. Why It Matters Right Now The review comes at a sensitive time. EV sales hit a record 14.6 per cent market share in March 2026, partly driven by fuel price anxiety. Industry bodies have warned that removing financial incentives prematurely could stall the transition. The FCAI has called on governments to prioritise public ch…