“The proposals contained in the draft bill on tax benefits for electric mobility go in the right direction. They will encourage the purchase and use of electric cars – into the next decade. We welcome most of all the planned extension of the special rules for taxing company cars up to 2030, as this creates planning security for both firms and users,” stressed Bernhard Mattes, President of the German Association of the Automotive Industry (VDA). Until now, this measure (halving the 1-percent rule) was set to be abolished at the end of 2021.
“Precisely because our companies are going to launch a large number of new e-models onto the market in the coming years, the extension of the special rule will exert a positive effect on the demand for e-cars and thus support the ramp-up of emission-free mobility. After all, the market for electric mobility needs both supply and demand,” Mattes said. The tax breaks will apply to battery electric company cars (BEVs) and to plug-in hybrid company cars (PHEVs), with the technical requirements for PHEVs gradually being tightened up. For purchases from 2022 to 2024, the benefits will be available for PHEVs with a minimum electric range of 60 km or maximum CO2 emissions of 50 g/km, and from 2025 to 2030 the requirements will be at least 80 km or maximum CO2 emissions of 50 g/km. To simplify the situation, we should keep the dynamic reference to the criteria defined in the German Electric Mobility Act, so that future evaluations will also be taken into consideration at the same time. Alongside the fully electric passenger cars, the plug-in hybrids also remain on the agenda – they can exploit their advantages when used for long journeys or high annual mileages,” Mattes explained.
Another proposal is to introduce special depreciation rules for purchases of new fully electric delivery vehicles (50 percent), which are to apply from 2020 to 2030 and only to commercially used electric vehicles in the classes N1 and N2 up to 7.5 tonnes. “The VDA has been calling for the possibility of special depreciation for a long time; the fleet managers in our member companies can now take this into account when making investment decisions,” Mattes emphasized. However, he added, the projected form of the measure fell short of the promotion agreed in the coalition agreement, which does not prescribe any restrictions for particular technologies, vehicle weights or delivery vehicles. Adjustments should be made during the legislative procedure, because heavy-duty vehicles are definitely also used for deliveries.
“Other good aspects are the extension of tax exemption for electricity used for charging on corporate premises, and the flat-rate tax on the transfer of ownership of charging equipment. They represent practicable, simple and non-bureaucratic measures for both owners and users of e-cars, which also reduce the amount of financial administration work,” Mattes said.
The VDA will play an active part in the upcoming hearing with the associations and push for rapid implementation of the planned measures.
In addition, the VDA calls for financial support for expanding the public and private charging infrastructure and for an extension to the purchasing bonus for electric cars beyond its current termination date.