The Bundestag has passed a law on tax relief for electric cars and electric-powered bicycles. Among other things, the assessment base for company car taxation, cut in half at the beginning of the year, will be gradually extended until the end of the year 2030. In addition, when acquiring a new electric delivery van up to 7.5 tons, the purchase price can be written down by 50 percent in the year of acquisition. According to the Bundestag, this regulation should now also apply to electrically powered cargo bicycles (PDF). In addition, fully electric cars with a list price of € 40,000 with retroactive effect from 1 January 2019 will benefit twice as much in tax terms from more expensive models and plug-in hybrids. This implements the corresponding points from the climate protection package of the Federal Government from October 2019.
By law, incentives would "especially for the market ramp-up of electromobility in the operational area"According to the draft, which was approved by the Federal Cabinet in July 2019. In addition, tax exemption will be extended until 2030 for benefits arising from charging an electric car to the employer and using an on-site charging device.
The 255-page design (PDF) contains a large number of changes to a total of 20 laws. The anticipated reductions in income from electromobility regulations were estimated at just over half a billion euros by 2023, with a tax credit of 230 million euros expected in 2023 alone. In the Bundestag amendment, the expected shortfall in revenue is estimated to be higher overall but not shown separately for electromobility.
More coverage required for hybrids
According to the Income Tax Act, which was amended at the beginning of 2019, employees who use a company car privately have to charge only half a percent of the gross list price for electric cars per month. For gasoline vehicles, this rate is twice as high. For vehicles "without carbon dioxide emission" this value is reduced to 0.25 percent. This regulation, which was originally limited until the end of 2021, will be extended until 2030. Unlike the government bill, a distinction is now made between fully electric cars and plug-in hybrids. It remains unchanged that the requirements for hybrids in terms of range are gradually increased.
Two conditions are still mentioned, of which at least one must be met: Either the CO2 emissions are below 50 grams per kilometer or a certain electrical range is achieved. Thus, for purchases between 2022 and 2024, the pure electric range must be 60 kilometers, while so far 40 kilometers were sufficient. After that, the battery even has to last for 80 kilometers if the CO2 emissions are exceeded by 50 grams per kilometer. This value should then be determined after the test cycle WLTP.
Criticizing promotion of plugin hybrids
In the future, buyers of all-electric electric cars under € 40,000 can benefit not only from a half-fold higher environmental premium, but also from a 75 percent reduction in company car taxation. More expensive electric cars are thus tax-equivalent to plug-in hybrids because they meet the corresponding criteria.
Thus, the federal government has responded in part to criticism. According to the green traffic expert Stefan Kühn "It can not be that the federal government treated heavy hybrid SUVs as company cars as well as purely electrically powered compact cars", The member of the Bundestag had also demanded that there should be no e-plate and thus no privileges in urban traffic for hybrids with mini-ranges. "It is absurd that thanks to the electromobility law large hybrid cars can park in many municipalities for free or drive on the bus lane"Bold had said.