During Budget Day 2024, the government announced new measures* that will affect electric driving and the cost of plug-in hybrid vehicles. These changes are important for anyone who already drives electric or is considering buying a zero-emission or hybrid car. In this article, we explain the main changes so you know where you stand.
* Cabinet proposals for 2025
The Cabinet adjusts several taxes each year.
The proposed measures are in the Tax Plan 2025.
The House of Representatives and the Senate have yet to approve the plans.
Discount on Road Tax for Electric Cars through 2029
Electric cars would still benefit from a 75% discount next year and from 2026 through 2029 from a 25% discount on motor vehicle taxes. This benefit was introduced because these cars weigh more than fuel cars due to their heavy batteries. This benefit offsets the higher costs and keeps electric driving interesting. Starting in 2030, the rebate will expire, at which point you will have to pay the full road tax.
This means that if you buy a new or used electric car now, you will benefit from lower tax costs until 2029.
This scheme is an important government incentive to continue promoting the transition to zero-emission cars and reducing harmful emissions.
New Rules for bpm on Plug-in Hybrids starting in 2025
Something important will also change for plug-in hybrid cars.
From Jan. 1, 2025, the bpm (purchase tax) for these cars will be calculated in the same way as for regular fuel cars.
This means that the price per gram ofCO2 emissions will be lower, but the final bpm will depend on the emissions of the specific model.
This change is in response to a new European measurement method that will calculate theCO2 emissions of plug-in hybrids differently starting in 2025.
Without this measure, the bpm for plug-in hybrids would be significantly higher.
By adjusting the rules, the government is preventing these vehicles from becoming disproportionately more expensive compared to gasoline and diesel cars.
From 2027, the calculation ofCO2 emissions will be even stricter so that the bpm will be even more in line with the actual emissions of these cars.
What Do These Changes Mean for You?
If you are considering buying an electric or plug-in hybrid car, now is the time to take advantage of lower taxes.
This is because the road tax rebate for zero-emission vehicles will remain in effect until 2029.
For plug-in hybrids, the rules around bpm become tighter, but thanks to the new measure, in many cases the costs remain comparable to those of fuel cars.
Staying abreast of these changes will help you better assess the cost of your car and take advantage of the tax breaks that are currently available.
In addition to these changes, there are a number of other electric driving tax benefits that are already in place.
Read more about them in this article!