The EFTA Surveillance Authority has approved Norway’s zero VAT rating for electric cars. This authorization is valid until the end of 2017. Other measures to stimulate the demand of electric cars are approved as well.
The president of the Authority, Ms. Oda Sletnes, stated: “The Norwegian fleet of electric cars is the largest per capita in the world. In 2014, 12.5 % of new registrations in Norway were electric cars, compared to only 0.3 % in the EU. This clearly shows how the measures put in place by the Norwegian authorities strengthen the demand for zero-emissions cars and thus contributes to a greener transport sector. This is essential to achieve the climate targets and to improve the poor air quality observed in many cities”.
The zero VAT rating for electric cars was notified by the Norwegian authorities in November 2014. During its assessment, the Authority also identified other measures already adopted by the Norwegian authorities to stimulate the demand of electric cars. Some of the measures have been in force since the 1990s.
The support scheme does provide an indirect advantage for manufacturers and dealers of electric cars. However, the scheme does not discriminate between car manufacturers since all electric car models are eligible for aid.
The Authority notes nevertheless that the price of electric cars is declining and that the technological progress is accelerating. As a consequence, the VAT measures are approved until 31 December 2017. After that, the Norwegian authorities could notify an extension of this scheme. When assessing the need for such an extension, the Authority will take into account the characteristics of the electric car market at the time of the new evaluation.
The Authority has not assessed the exemption from registration tax for electric vehicles, the free public parking and the free charging, but will keep these measures under review.
Source: The EFTA Surveillance Authority.