More electric vehicles exempt from luxury tax, Ottawa says
Finance Minister François-Philippe Champagne announced that starting Friday, all electric vehicles that cost less than $150,000 would be exempt from the 10 per cent tax.
Finance Minister François-Philippe Champagne announced on Friday that electric vehicles costing less than $150,000 will be exempt from Canada's luxury tax, increasing the price threshold from the original $100,000. This decision reflects the higher upfront cost of zero-emission vehicles and supports the global shift to electric vehicles.
According to the Canadian Automobile Association, the average price of a new electric vehicle in Canada is around $50,000, but some models exceed $100,000. Despite this, zero-emission vehicles only made up 3.5% of Canada's registered light-duty vehicles in 2025, with over 58,000 new registrations that year. Budget 2026 will invest $587 million over five years to install more than 55,000 EV chargers, further expanding the availability of federally supported chargers.
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