We buy an electric car - is it profitable for us?

We buy an electric car - is it profitable for us?

If you are already the owner of an electric car or you are considering buying such vehicle, you are
probably also not indifferent to our environment and want to actively participate in the process of
turning our world into eco-friendly place. The popularization of electric cars that has been going on
recently is an excellent way to contribute to that goal. It has become a politics matter worldwide. A
lot of countries’ authorities decided to set up strict mandates to make their residents transition away
from the petrol and diesel cars they were used to until now. Some sources claim that even the
European Commission is going to issue requirements for certain amount of electric vehicles to be
distributed by 2030. Considering that France, the Netherlands and Great Britain are already planning
to ban diesel by the year 2040, the new mandate seems very likely.

It’s not a secret that there is a significant growth of interests for electric vehicles in Europe. Right
now the leaders on the European eco-mobility market are Norway and The Netherlands. Their shared
number of electric vehicles on the road is about 240,000 cars. Half of Norway’s all new cars are fully
electric or plug-in hybrids, whereas The Netherlands is developing electric public transportation and
charging infrastructure. Those two countries are followed by others - like Belgium, France, Germany,
and the UK - that, forced by strict emission standards, do everything in their power to convince
people to switch to electric cars. By this you should understand a variety of benefits that each
country presents to electric car owners. Below, adapted from the EV-Box blog, you can find each
country’s offers aimed at promoting electric vehicles.

Belgium

Though not much of an early adopter, Belgium is catching up. In 2016, the number of electric-car
sales in Belgium almost tripled, and the number of charging points grew by 350% as compared to
2015.
Purchase grant: €4000 grant in Flanders for private car owners.
Ownership tax: (Plug-in) electric vehicles are exempt from ownership tax in Flanders. They also pay
the lowest rate of the annual ownership (circulation) tax (€74 instead of €1900) in all three regions.
Company car tax: 120% for fully electric vehicles, and 100% for vehicles emitting between 1 and 60
g/km of CO2 deductible from company expenses. Above 60 g/km, the deductibility rate decreases
from 90% to 50%.

France

France made tremendous gains in electric-car numbers over the past few years. Going from
fewer than 10,000 registered electric vehicles in 2012 to over 100,000 in 2016.
Purchase grant: If you swap your diesel (bought before 2016) for a fully electric model, you are eligible
for €6000 (environmental bonus) and €4000 as a “thank-you for switching to electric.” If you swap
your diesel (bought before 2016) with a plug-in hybrid, you’re eligible for €1000 (environmental
bonus) and €2500 as a “thank-you for switching to electric.”
Ownership tax: Both fully electric vehicles and plug-in hybrids are eligible for either a 50% discount or
are exempt from the license plate tax depending on the province.
Company car tax: Fully electric vehicles are exempt from this tax. Plug-in hybrids are exempt from the
tax for two years.

UK

The UK government pledged a £290m sum to boost the industry of low emission vehicles. £80m of
this amount is dedicated to improving charging infrastructure for electric vehicles.
Purchase grant: The Plug-In Car Grant covers 35% of the cost of a car (up to a maximum of £4500
depending on the model) and 20% of the cost of a van, up to a maximum of £8000. This is without
doubt the important incentive for private vehicles in the UK. In some cases, it can reduce the total
cost of electric vehicles below the cost of conventional cars!
Ownership tax: Fully electric vehicles costing less than £40,000 are exempt from the annual road tax.
Company car tax: (Plug-in) electric vehicles emitting less than 50g/km of CO2 have their company car
tax set at only 9% for 2017–2018. 13% in 2018–2019, and 16% in 2019–2020. The tax on any diesel
company car is 4–8% higher.

Germany

Home to the most beloved (and scandalous) combustion engine car manufacturers, Germany has
been the slowest of the bunch in pushing pro-electric plans. But as of last year, Germany has adopted
an incentive and investment program to encourage a switch to plug-in hybrids. Additionally, it has
approved a push for a Europe-wide ban on combustion engine vehicles by 2030.
Purchase grant: €4000 for fully electric vehicles and €3000 for plug-in hybrids. The grant applies only
to cars up to a maximum list price of €60,000.
Ownership tax: 10 year exemption for fully electric vehicles registered between 2011 and 2020.
PHEVs pay the tax, which is lowered in proportion to their lower CO2.
Company car tax: 1% over the discounted car (battery) price. €300/kW (up to €8000) discount on the
list price for fully electrics and plug-in hybrids in 2017. €250/kW (up to €7500) discount on the list
price for fully electrics and plug-in hybrids in 2018.

The Netherlands

The Netherlands is planning to phase out all internal combustion engine vehicles by 2035. The
Netherlands has the highest ratio between public charging points and electric vehicles. 7% of Dutch
drivers often or always charge at work.
Purchase tax: Fully electric vehicles and PHEVs are both exempt from this tax. PHEVs will need to pay
additional fees based on the CO2 emitted.
Ownership tax: Fully electric vehicles are exempt from this tax, while PHEVs get a 50% discount.
High-CO2-emitting vehicles of +12 years old will need to pay another 15% on top of the tax starting
2019.
Company car tax: 4% for fully electric vehicles only, 22% for both PHEVs and high-CO2-emitting
vehicles.

Norway

Norway’s original goal was to have 100,000 electric vehicles on the road by 2020. As of last year,
Norway has already exceeded this number, as there are now more than 121,000 electric vehicles on
the Norwegian roads. Quite impressive for its relatively small population of just 6 million.
Purchase tax: No purchase tax and no VAT on purchase.
Ownership tax: NOK 455 is the annual road tax for both fully electric vehicles and plug-in hybrids, as
opposed to NOK 2820 for petrol and NOK 3290 for diesel cars.
Company car tax: 50% discount for both fully electric vehicles and plug-in hybrids.

And that’s not all. According to Zhou, although there are nationwide incentives, many European cities
actually “go a step further to get their citizens behind the electric wheel. This means that on top of
your usual financial incentives, your electric car may be eligible for extra perks, depending on the city
you live in or drive by: free public parking, exemption from toll charges, access to HOV lanes and bus
lanes, exemption from ferry fees, [and] free charging on public charging points.”

source Autocar.com, gov.co.uk