Salary Sacrifice Electric Vehicle and the National Average
Salary sacrificing an electric vehicle (EV) is a popular way to reduce taxable income while driving a low-emissions car. Under the Australian Tax Office’s fringe benefits tax (FBT) exemption for eligible electric cars (in place since 1 July 2022), the value of the car and its running costs can be salary sacrificed without incurring FBT. This makes the arrangement attractive for employees earning above the tax-free threshold.
But how does this affect your position on the national salary line? The line on this site is based on your pre-tax ordinary-time earnings—the figure before any salary sacrifice deductions. The ABS Average Weekly Earnings (May 2026) puts the national full-time adult ordinary-time average at $2,083.70 per week, or about $108,352 per year. That is the benchmark you see on the chart. Salary sacrificing an EV does not change that pre-tax figure; your employer still reports the same gross salary. What changes is your taxable income, which is lower after the sacrifice, and your take-home pay may be higher because you avoid tax on the sacrificed amount.
How the Line Stays the Same
The line measures your salary before tax and before any salary packaging. If you earn $110,000 per year and salary sacrifice $10,000 for an EV, your reported salary on the line remains $110,000. The site compares that to the national average of $108,352. Your distance from the line is based on the gross figure. The sacrifice itself is a post-salary arrangement that the line does not capture. This is important: the line is a pre-tax benchmark, not a measure of disposable income.
State Differences and the National Line
State full-time averages vary, as shown on the States and territories page. For example, the Australian Capital Territory has the highest average at about $119,090, while Tasmania is lowest at about $96,008. If you salary sacrifice an EV, your gross salary is still compared to your state’s average. The FBT exemption is federal, so the tax benefit is the same regardless of state. However, state-based incentives (like stamp duty exemptions for EVs) can reduce the upfront cost, but they do not affect the salary line. The line uses pre-tax earnings, so state payroll taxes or concessions are irrelevant to the comparison.
Award Coverage and Minimum Wage Constraints
Award-covered employees can participate in salary sacrifice, but the arrangement must not reduce the employee’s base rate below the applicable minimum wage or award rate. The national minimum wage from 1 July 2026 is $26.44 per hour, $1,004.90 per week, or about $52,255 per year on a 38-hour week. Award minimums rose 4.75% from that date. If your salary after the sacrifice would drop below the award minimum, the arrangement is not permitted. This means that lower-paid workers may have limited capacity to salary sacrifice an EV. The site’s line for minimum wage earners sits well below the national average, and the sacrifice cannot push them further down. For higher earners, the sacrifice is more feasible.
The full-time median (ABS Employee Earnings, August 2025) is about $90,532, and the all-employees median is about $74,100. These medians are also pre-tax and unaffected by salary sacrifice. The line you see on the chart is the average, not the median, so your position relative to the line may differ from the median comparison.
Practical Considerations for Your Salary Line
When you Place a salary on the line, you enter your yearly pre-tax salary. If you salary sacrifice an EV, enter the gross amount before the sacrifice. The tool will show your weekly and hourly equivalents on a 38-hour week, and the distance from the national average. The sacrifice does not change that distance. However, your effective tax rate is lower, which the tool does not display. For a full picture, consider your after-tax income separately.
How the Figures Are Set
The national average comes from the ABS Average Weekly Earnings survey, published twice a year (May and November). The May 2026 figure is the current benchmark. Medians come from the ABS Employee Earnings and Hours survey (August 2025). The minimum wage is set by Fair Work. These sources are independent and updated on different schedules. For more on methodology, see How the figures are set.
Summary
Salary sacrificing an electric vehicle is a tax-effective strategy that does not alter your pre-tax salary line. The national average, state averages, and medians remain fixed benchmarks. Award constraints and minimum wage laws set a floor below which sacrifice cannot go. Use the line to see where your gross pay sits, and consider the sacrifice as a separate benefit that improves your take-home pay without moving the line.
For further reading, explore Guides on salary packaging and electric vehicle incentives.