Australia’s Electric Car Discount has been a game-changer for EV adoption since it was launched on 1 July 2022. Now, Australian Commonwealth Treasury has commenced a statutory review of the concessions. While no immediate changes are proposed, it is worth understanding what is being examined and why it matters for your business.
What is an electric car discount?
The Electric Car Discount was introduced to reduce the upfront and ongoing costs of EVs, with two key concessions:
- an exemption from Fringe Benefits Tax (FBT) for eligible EVs provided to employees, including through salary packaging; and
- an exemption from import tariffs on eligible vehicles.
These measures were designed to accelerate EV uptake, expand consumer choice and support Australia’s broader emissions reduction objectives. By most measures, they have worked with EV adoption growing significantly since the concessions were introduced.
What is the Treasury Review examining?
As required by legislation, Treasury announced the review in December 2025 to assess how the Electric Car Discount has operated over its first three years. The review will examine:
- how effective the concessions have been in encouraging EV adoption
- whether the current design and eligibility settings remain appropriate
- how the concessions interact with other Commonwealth policies, including broader transport and emissions measures.
What it means for employers right now
Good news: nothing changes today. Employers can continue to apply the FBT exemptions to eligible EVs that meet existing criteria, and keep offering EVs through salary packaging or fleet arrangements.
However, the review signals that future policy settings may evolve. As EV adoption becomes more mainstream and the fiscal impact of the concessions grows, it is reasonable to expect some adjustments down the track, particularly to eligibility thresholds or the scope of vehicles covered.
