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New tax guide suggests huge growth in EVs and hybrids will change the tax dynamic

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By 2030, one in three new cars registered in Europe could be an electric or plug-in hybrid vehicle, forcing governments to re-evaluate tax systems to avoid losing revenue.

The growth has been forecast by Nexus Communication, in conjunction with PwC, in its 2017 Fleet Europe Taxation Guide.

In the report predictions are based on the assumption that current issues with battery capacity, insufficient installation of charging points and high prices for electric and plug-in hybrid cars will be solved.

However, it looks likely to only be a matter of time before Governments re-examine the tax benefits of electric and hybrid cars in the light of falling income from car taxation. In the meantime, fleet managers are advised to continue to evaluate the use electric and hybrid cars in order to reduce tax costs, which are often between 15% and 20% of the overall TCO, says the Guide.

Fleet Europe editor-in-chief, Steven Schoefs, said: “Slowly but surely, car taxation will start promoting the new mobility paradigm. Car pooling and other shared mobility options will be favoured, in order to help us shift from car ownership to car usage.

“As a consequence, company car taxation will become even more complex, with even more local tax variations under the guidelines of a European tax umbrella.  Corporate fleets will be taxed to move forward with smart alternative mobility schemes, and we will see a growing switch from Total Cost of Ownership to Total Cost of Mobility.”

The 23 countries covered in the printed version of the 2017 Taxation Guide are: Austria, Belgium, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Luxembourg, Netherlands, Norway, Poland, Portugal, Romania, Russia, Spain, Sweden, Switzerland, Turkey and the United Kingdom.

The digital version expands this to 29, with those from the printed version plus the Baltic states of Estonia, Latvia, Lithuania and three Eastern European countries, Bulgaria Slovakia, Slovenia.

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