According to a media report by Reuters, Norway’s new government is planning a luxury tax on expensive electric cars. Specifically, the future cabinet plans to impose a 25 % VAT (value-added tax) on the portion of the purchase price that exceeds 600,000 kroner (about $67,000).
According to a Reuters report, the introduction of the tax is likely to take place in the context of the change of government in Norway. Till today, all fully electric vehicles have been tax-free.
This would affect electric vehicles from Luxury carmakers such as Porsche, Audi and Mercedes-Benz, among others. According to the news agency, the Labour Party argues that the move is justified on grounds of fairness.
In addition, the tax exemption for the purchase of electric cars is intended as a means to introduce new technologies and cannot apply indefinitely, Svein Roald Hansen, tax policy spokesperson for the Labour Party, is quoted in the report.
But there are also opponents of the proposed measure, such as the Norwegian EV Association. According to Reuters, its head Christina Bu warns that a tax on electric luxury vehicles would come at an inopportune time and ultimately slow down the electrification of Norway.
In Norway, all newly registered cars, light commercial vehicles and buses are to be purely electric as early as 2025. In September 2021, electric cars already accounted for 77.5 per cent of new registrations.