The Land Transport Authority (LTA) has announced a new transitional road tax framework for all new Electric Vehicles (EVs) registered before 1 January 2021.

The LTA announced that the transitional revision has been conducted to better reflect current trends in vehicular efficiency and to partly account for fuel excise duties which EVs do not incur, until it is ready to impose a distance-based tax.

Existing owners of electric cars, or those who register electric cars before 1 January 2021, will be able to enjoy the technical revision to the variable component of their current road tax from 1 January 2021 onwards, which will lead to an across-the-board reduction in road tax for all electric cars.

In addition, they will also see a waiver of the additional flat component of road tax for a three-year period from 1 January 2021 to 31 December 2023. The full quantum of which will only be applicable from 1 January 2024.

The LTA will inform EV owners of the road tax payable at the next road tax renewal, while existing electric car owners who have already paid the road tax for the period beyond 1 January 2021 based on the existing road tax schedule will have their excess road tax paid offset by the amount payable at the next road tax renewal.