Norway plans to scrap tax exemption for electric vehicles by 2027

""We had set the goal that all new passenger cars would be electric by 2025, and with a share of 95 percent electric vehicles this year, one can say that the goal is practically achieved," Finance Minister Jens Stoltenberg said in a statement. "That is why the time has come to phase out the incentives," he added. The government argues that zero-emission cars will remain comparatively financially attractive as it also plans to increase a one-time tax on purchases of fossil-fuel vehicles."

""While being the largest oil producer in Europe outside Russia, Norway boasts the highest adoption rate of electric cars in the world. In September, electric cars accounted for over 98 percent of new registrations, bringing the monthly average since the beginning of the year to 95 percent of new vehicles. "Whether new or used, the price of electric cars will increase significantly," Christina Bu, Secretary General of the Norwegian EV Association, told broadcaster TV2.""

""Then, the VAT exemption would be abolished entirely by 2027. VAT in Norway is set at 25 percent for cars. As the Labour government is in the minority, the proposal still needs to be approved by its partners in parliament before being passed. The government noted that the VAT exemption currently represents around 17.5 billion kroner in lost tax revenue.""

Norway proposes abolishing the VAT exemption for cars by 2027, replacing a key subsidy that currently exempts electric vehicles from the 25 percent VAT. The government plans a higher one-time tax on fossil-fuel vehicle purchases to keep zero-emission cars relatively attractive. Electric vehicles already comprise about 95 percent of new registrations year-to-date and exceeded 98 percent in September. The proposal requires parliamentary approval because the Labour government is in the minority. Critics warn that a rapid phase-out will raise electric car prices significantly and could undermine climate policy. The VAT exemption represents roughly 17.5 billion kroner in foregone revenue.

Read at www.thelocal.no