From 1 January 2026, electric vehicle (EV) owners in Malaysia will no longer enjoy tax-free motoring. The government has announced that road tax for EVs will be introduced at rates starting as low as RM20 per year, with the highest tier capped at RM850 annually.
The new structure is based on motor output (kW), rather than engine displacement, as applied to internal combustion engine (ICE) cars. By linking road tax directly to motor power, the system indirectly ties in with the price and performance of each EV. Smaller, affordable models will be taxed at the lower end, while high-powered luxury EVs will sit at the top of the scale.
Datuk Shahrol Halmi, President of the Malaysia EV Owners Club, pointed out that the rates are far lower than the pre-2022 formula, which many had feared would return once current exemptions expired. He described the announcement as a welcome surprise, noting that a model like the BYD Atto 2, with a 130kW motor, would only attract an annual road tax of about RM120.
