Tax break for electric cars to be cut to fill budget black hole
Owners of electric cars will have to pay more road tax from 2026 to compensate for a miscalculation by the last government when it brought in an incentive to encourage people to buy them.
Currently electric vehicle owners receive a 75% discount on the provincial tax, which pays for road maintenance.
The tax break was due to be phased in stages over the next five years, falling to 40% in 2026 and 30% in 2028 before being dropped in 2030.
The scheme was expected to cost the government €1.5 billion in lost tax income. But finance minister Eelco Heinen discovered while compiling next year’s budget that the last government had failed to account for the fact that electric vehicles are much heavier than those that run on fossil fuels, meaning they should be taxed more.
The so-called “double discount” – a reduction on a tax set at the wrong level – would cost the treasury €3.8 million in total, civil servants calculated, adding that the disparity was “not properly reflected in the financial calculations”. The government also underestimated the number of electric cars sold.
Heinen responded by cutting the discount straight to 25% from 2026, meaning electric car owners will enjoy a smaller advantage until 2030.
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