NEW EV Road Tax Structure Announced For Jan 2026 - 85% Lower Rate

Transport Minister Anthony Loke announced that starting Jan 1, 2026, road tax (LKM) rates for electric vehicles (EVs) will be adjusted based on the power of the electric motor. This initiative aims to promote the adoption of EVs by offering a significantly reduced fee structure - 85% lower than the current rates.

Loke also mentioned that the fee rates for EVs will undergo a review at least every five years. This periodic review is crucial to ensure that the fee structure remains effective in promoting EV usage and to assess its impact on government revenue. By regularly evaluating the rates, the government aims to balance the goals of environmental sustainability and fiscal responsibility.

The new road tax rates will vary according to the power of the electric motor just like the previous structure, but it has been fine tuned. As the power of the electric motor increases, so will the LKM fee, ensuring that the tax system remains equitable and proportionate to the characteristics of different EVs.

The new LKM fee rates apply exclusively to EVs and fuel cell electric vehicle (FCEV) categories. By focusing on these specific categories, the government aims to standardise the taxation approach for the most common types of zero-emission vehicles on the market.

Overall, this initiative is part of Malaysia's broader environmental and economic strategy to reduce carbon emissions and promote sustainable transportation solutions. By significantly lowering the road tax for EVs, the government hopes to make these environmentally friendly vehicles a more attractive option for consumers, thereby contributing to a cleaner and greener future.

From the list of vehicle and new road tax structure provided by the Ministry of Transport, we at CariCarz.com however did notice some errors in certain vehicles kW. For instance, the BYD Dolphin Premium is stated at 130 kW with a roadtax of RM120, when it is actually 150 kW and should be charged RM160.

However these are just small errors which would be rectified by the time the vehicles need to start paying for road tax in January 2026. Overall, we are extremely grateful for the massive readjustment in the new EV road tax structure which would indeed puck EV adoption forward in 2024 and beyond. 

Source: TheMalaysianReserve