German cabinet decides tax break package for electric company cars

The German government has adopted a draft bill to foster e-mobility and environmentally friendly transport, writes the government’s press service. Electric delivery vehicles are to be given a special tax depreciation, while tax breaks for using and charging electric as well as hybrid company cars would be extended until 2030. The motor vehicle tax exemption for newly registered electric vehicles will be extended from five to ten years and company-provided public transport passes will be tax exempt. The government also decided on measures to promote bicycles and public transport. Managing director of the municipal utility association VKU Katherina Reiche called the tax breaks for company vehicles the right “first step” to promoting electric mobility overall, but stressed that there was “still an urgent need for action” in expanding infrastructure for private charging points. Head of utilities association BDEW Stefan Kapferer said legal hurdles to installing charging stations at workplaces, in industrial estates, and apartment buildings “must finally be removed” if Germany is to reach its declared goal of becoming the world’s leading market for e-mobility. The draft will now be debated in parliament.

Despite overtaking Norway as the world’s third largest e-mobility market in 2019, electric cars only make up a tiny percentage of newly registered vehicles in Germany and the government is struggling to get a transition towards more climate-friendly transportation off the ground. The country’s biggest carmakers, long reluctant to embrace the mobility transformation, now all have ambitious plans for ramping up the output and sales of electric vehicles in the 2020s, which could lead to a sudden boost in demand for charging stations.