Norway Could End VAT Exemption For EVs In 2016
In Norway, all-electric cars are exempt from VAT, which is one huge incentive (among others) to buy one.
The regulations provides such exemption until 2017 or 50,000 cars, whichever comes first.
Because some 60% of this pool is already exhausted and new sales regularly exceed 1,000 passenger cars, we expect that the 50,000 mark will fall early 2015. Moreover, we expect that sales will accelerate after crossing 40,000 because everyone interested in EVs will be willing to buy them quickly to avoid the tax.
There is no decision on what will happen after 50,000 mark however according to Norwegian media, government is considering introducing VAT on electric cars from 2016 on.
If this happens, VAT for EVs will probably grow step by step like 8% in 2016, then 12% in 2017 and 16% in 2018.
To maintain high market share, manufacturers will be forced to match this rise from VAT with lowered prices.