Data on electric vehicle (EV) tax discounts reveals that uptake is predominantly occurring in outer suburban areas, prompting concerns that ending the exemption could disproportionately affect families with longer commutes.
EV Discount Popularity Skews Towards Outer Suburbs
Analysis of postcode data for the Electric Car Discount shows that the majority of motorists claiming the tax benefit reside in the outer suburbs of New South Wales, Victoria, and Queensland. This trend highlights a significant reliance on the exemption for these households, many of whom face daily commutes exceeding an hour.
The findings emerge as the federal government reviews the fringe benefits tax (FBT) exemption for electric cars. This review follows recommendations from the Productivity Commission to phase out such discounts. Simultaneously, global fuel supply disruptions and heightened demand have driven petrol and diesel prices above $2 a litre, increasing the financial pressure on commuters.
The tax cut, implemented in 2022 for electric cars purchased via novated leases, has seen a higher-than-anticipated uptake, with over 114,000 claims made to date.
Concerns Over Impact on Cost of Living
Rohan Martin, chief executive of the National Automotive Leasing and Salary Packaging Association (NA LCSA), warned that removing the EV tax exemption could exacerbate the cost of living for families in outer suburban areas.
“Since its inception, the EV FBT tax exemption has been most popular among working families living in the outer suburbs – a pattern that continued strongly in 2025,” Mr Martin stated. He added, “Australians living in the outer suburbs often face longer commutes and are more likely to have access to rooftop solar and off-street parking.”
According to Mr Martin, the discount frequently serves as the deciding factor for motorists choosing an electric vehicle over a traditional petrol car, particularly for families struggling with the initial price disparity.
EVs as an Alternative to Volatile Fuel Prices
Francis Vierboom, chief executive of Rewiring Australia, emphasized the importance of supporting EV adoption in the current economic climate, marked by volatile fuel prices.
“Australians will be spending $700 more a year at the bowser because of instability on the other side of the world,” Ms Vierboom commented. She further noted, “The discount on salary packaging EVs gives working families an alternative to expensive and dirty petrol vehicles.”
Personal Experience: A Teacher’s Switch to Electric
Shantele, a primary school teacher on the Sunshine Coast, shared her experience of purchasing an electric SUV through the tax exemption nearly a year ago. Her family of five had been contemplating a switch from their petrol car to manage costs associated with an 80-minute daily commute between Beerwah and Mooloolaba.
“The tax cut made a lot of sense,” Shantele told AAP. “It was something we’d been talking about doing – going to an electric vehicle – and this made it a better way to do it.”
Looking ahead, Shantele indicated that her next vehicle would likely be an electric van to accommodate her growing children. However, she stated this decision is contingent on the continued availability of the tax cut.
Top Postcodes for EV Tax Discount Claims (2025)
The NA LCSA identified the following top 10 postcodes where motorists have most actively utilized the Electric Car Discount:
New South Wales and Victoria Lead Uptake
Several Victorian postcodes feature prominently in the top 10, indicating strong adoption in the state’s rapidly developing suburban areas.
- Victoria 3029: Tarneit, Hoppers Crossing
- Victoria 3030: Werribee, Point Cook
- NSW 2765: Marsden Park, Riverstone
- NSW 2155: Kellyville, Rouse Hill
ACT and Queensland Show Significant Interest
The Australian Capital Territory and Queensland also demonstrate notable engagement with the EV tax incentive, particularly in newer residential areas.
- ACT 2611: Coombs, Wright, Duffy
- Queensland 4300: Springfield, Springfield Lakes
- Victoria 3064: Craigieburn, Roxburgh Park
- NSW 2153: Baulkham Hills, Winston Hills
- NSW 2620: Queanbeyan
- ACT 2914: Harrison, Bonner, Amaroo
Source: National Automotive Leasing and Salary Packaging Association