Norway is gradually eliminating tax breaks for electric cars / Infocar
Norway is setting plans to gradually cease a significant fiscal incentive for electric vehicles throughout the ensuing couple of years, according to a governmental proposition introduced within the state budget blueprint.
This is covered by Delo.ua citing Reuters.
This entails that from 2026 onwards, an extra impost will be required even for popular models, for instance, the Tesla Model Y, which is the most favored vehicle in the nation.
Currently, electric automobiles comprise more than 98% of all recent car sales in Norway, and the country has basically fulfilled its aim of transitioning entirely to electric by 2025.
“It’s fair to suggest that the objective has been attained. The moment has come to systematically phase down the incentives,” stated Finance Minister Jens Stoltenberg.
To date, the government has exempted electric vehicles from taxes applicable to internal combustion engines, thereby forgoing billions in yearly revenue. However, back in 2023, the administration rolled out a 25% VAT on the component of an electric vehicle’s price surpassing 500,000 kroner (≈49,500 US dollars) – this tax was relevant only to high-end versions such as the BMW iX, Tesla X and Porsche Taycan.
As per the fresh recommendation, from 2026 the VAT waiver will be curtailed to 300,000 crowns, thereby rendering all variants of the Tesla Model Y and comparably valued vehicles, including the Volkswagen ID.4, accountable for taxation. The intention is to completely eliminate the exemption in 2027, with all electric vehicles being taxed on a standardized basis.
Meanwhile, the government intends to augment taxes on automobiles powered by internal combustion engines, to sustain the motivation for acquiring electric vehicles.
The Norwegian Electric Vehicle Association has aired disapproval of the verdict, terming it “precipitate.” Its president, Christina Boo, cautioned that the abrupt increase in cost could propel individuals to revert to purchasing fossil fuel-driven automobiles. Notwithstanding the elevated degree of electrification, seven in every ten vehicles across the nation continue to operate on petrol or diesel.
As a reminder, Tesla escalated the prices of its Model 3 automobiles in European countries, encompassing Germany, the Netherlands, and Spain, by approximately 1,500 euros ($1,622) back in July, subsequent to the EU enacting tariffs on electric vehicles manufactured in China.
Subsequently, on Friday, October 4, the European Union cast a vote to enforce tariffs of up to 45% on electric vehicles originating from China.
