Porsche Taycan Road Tax – How Is It So Expensive?

With the launch of the Porsche Taycan, we got an insight into how electric car road tax is calculated… but how is it so expensive?

The Malaysian government is going to have an interesting task ahead of them. Electric cars are coming, whether we like it or not, and our road tax system has been based purely on displacement – i.e. a 1.3-litre car gets charged significantly less road tax than a 6.2-litre car. Part of this is simply because it’s a form of revenue for the government and helps with maintaining our roads (albeit really horribly), but another large part of it is a form of luxury tax.

We’ll get back to luxury tax in a bit. In other countries, roadtax is based on emissions – cars that pollute more generally have to pay more tax, which is a pretty significant reason for automakers to fight so hard when it comes to getting emissions down. This translates easily to electric cars, as figuring out how much an electric car pollutes is simply based on how much energy it needs to travel a specific distance, and how clean that electrical energy is through the means of productions.

Over here, short of overhauling our entire road tax system, the Malaysian government decided to go with performance figures and loosely base it off what is known when it comes to petrol engines. There is a pretty large flaw in this calculation, but again we will discuss this later on. For now, the basic calculation is as follows:

For reference, the road tax on a Nissan Leaf comes in at around RM374 for its 110 kW/147.51 hp output – although there’s currently a discount on it. The MINI Cooper SE that was recently launched sees a road tax of RM724, for its 135 kW/181.04 hp output. Here is where we start to see a little bit of a discrepancy compared to conventional cars, where both naturally aspirated and turbocharged variants are taxed far less than their power outputs based on their displacements. Even a Subaru BRZ at around 200 hp would only cost you RM380 in road tax for its 2.0-litre engine.

That’s why there is such a big uproar surrounding the taxation of the Porsche Taycan across all its variants. For those who haven’t seen it yet, the tax rates are as follows:

Yep, that’s a lot of money. That being said, it is peculiar that the amount of road tax you have to pay for your Taycan isn’t too far off what you’d have to pay in something like a Porsche Panamera Turbo or a BMW M5. Well – sort of. A top spec Panamera runs with a twin-turbocharged 4.0-litre V8 that will cost you RM6,630 in road tax, while a BMW M5 sees you paying around RM8,500 for its 4.4-litre V8 biturbo engine.

Both performance levels aren’t too far off what the Taycan is making, so in a sort of twisted way you can see that the road tax isn’t altogether ludicrous. As many have pointed out, if you can afford to take ownership of a Taycan, you can probably afford the road tax. That and the fact that maintenance costs are significantly lower for an electric car.

There are two arguments that have to be addressed here. The first is that many have pointed out how flawed this approach is if the government is really looking for widespread electric car adoption, as has been the case in many other countries. In other countries, electric car owners even get incentives when they purchase their vehicles to make the deal that little bit sweeter, and they pay almost no road tax. With road tax values for electric cars being higher than conventional cars, you start having a problem.

The second is that you can expect higher outputs to have significantly more tax, because that’s the function of a luxury tax. The vast majority of electric cars are not going to have over 150 kW of power – in fact, in the future you will probably see most electric cars coming in at around 90 kW to 100 kW of output, which is about the range of outputs from a Perodua Myvi to a Honda City.

So to EV or not?