Norway to Extend Tax Reduction Incentives on Electric Vehicles for 2 More Years

Photo: Team O'Neil Rally School/Facebook

Previously, the Norwegian authorities had offered to exempt zero-emission electric vehicles from VAT for another two years. This important measure was approved today by the EFTA Surveillance Authority (ESA).

These measures are intended to stimulate the purchase or rental of zero-emission electric vehicles (ZEV) instead of fossil fuel alternatives, and thus increase the share of ZEV in Norway. This policy only applies to battery electric vehicles (BEVs) and fuel-cell electric vehicles (FCVs). Non-rechargeable hybrid electric vehicles and plug-in hybrid electric vehicles are excluded.

"The measures concern the prolongation of: (i) the zero VAT rating for the supply and import of zero-emission vehicles; (ii) the zero VAT rating for the leasing of zero-emission vehicles; and (iii) the zero VAT rating for the supply and import of batteries for zero-emission vehicles."

An agreement with the European Environmental Agency (EEA) allows state aid to be used to promote environmental protection where there is an incentive effect. ESA believes this measure is in line with Norway's and EEA's goals to reduce greenhouse gas emissions.

The ESA is now allowing tax cuts to be extended for another two years, until the end of 2022, which will largely stimulate electric vehicle sales in Norway.

H/T @StianWalgermo/Twitter

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