Following the recent implementation of the Dutch Tax Plan 2024, in this Automotive Update we will discuss the latest tax developments and expectations in the automotive sector. We will highlight the most important changes in the field of subsidies and taxes for zero-emission cars. In addition, we will discuss the status of the upcoming truck tax.
In its Climate Agreement (Klimaatakkoord), the Dutch government has declared its intention to strive for zero-emission road mobility, with subsidies for zero-emission cars as an important instrument. This policy is in line with European ambitions, as laid down in the European Green Deal, which sets ambitious goals for emission reduction and energy transition in the automotive sector. An important element is to cease the production of fossil fuel cars by 2035, which means that car manufacturers must focus on a future in which electric cars (EVs) and hydrogen-powered cars (FCEVs) are the norm.
The energy transition and climate goals mainly determine the Dutch policy regarding car taxes. Hereafter we will provide you with an update on subsidies and taxes around zero-emission mobility and the status of the upcoming truck tax.
Subsidies and taxes of zero-emission vehicles
Subsidizing zero-emission mobility is an important pillar for climate goals and energy transition. Therefore, in recent years the Netherlands has focused on various subsidies and tax schemes to promote the purchase and use of electric cars. Nevertheless, an interesting dynamic is visible in which subsidies for zero-emission vehicles are being reduced or reconsidered internationally for various reasons. Below we will provide you with an overview of the main Dutch subsidy schemes and taxes. This shows that tax incentives for zero-emission cars are also being phased out in the Netherlands.
The Private Motor Vehicle and Motorcycle Tax (BPM) for zero-emission cars
The BPM is levied as a registration tax when a car is purchased or imported into the Netherlands. The amount of the tax for cars consists of a fixed amount and a variable part based on the CO2 emissions of the car in question. Zero-emission cars are exempt from BPM until 2024. From 1 January 2025, the exemption from BPM for zero-emission cars will expire and BPM will become due upon registration. Consequently, a base rate of €200 will apply. Plug-in hybrid electric cars (PHEVs) will still have their own BPM rate with no base rate in 2024, but the base rate will be raised to €200 for these cars in 2025 as well.
Motor vehicle tax (MRB) for electric and plug-in hybrid electric cars
In 2024, no MRB will be payable for the possession of an electric car and highly fuel-efficient cars such as plug-in hybrid electric cars will be subject to a reduced rate with a 50% discount in 2024. However, the exemption for electric cars will be scaled down after 2024. As of 2025, the exemption for electric cars will expire and a 75% reduction in the MRB rate will apply. For plug-in hybrid electric cars, a 25% reduction applies in 2025. From 2026 it is expected that the full MRB rate will apply to all cars, regardless of emission.
Phase-out reduced wage tax addition for zero-emission cars
The reduced wage tax addition for zero-emission cars will be phased out over the next few years, making the wage tax addition the same for all cars as of 2026. In 2024, the wage tax addition for electric cars will still be 16% (unchanged from 2023) on the list price up to the threshold amount of €30,000. Above the threshold amount, the regular wage tax addition of 22% applies. However, for 2025 the wage tax addition for electric cars will be increased to 17% up to the threshold amount, after which in 2026 the wage tax addition will apply to all cars. Interestingly, on hydrogen-powered and solar cell cars, the lower rate can be applied to the entire list price, i.e., without the threshold.
Update subsidy schemes 2024 and 2025
The Private Electric Passenger Car Subsidy Scheme (SEPP) and Zero-emission Company Car Subsidy Scheme (SEBA) are two important subsidy schemes that will be active in 2024. For the private purchase or lease of a (used) electric passenger car, a subsidy of €2,950 applies in 2024, while used cars are eligible for a subsidy of €2,000. In 2025, the subsidy amount decreases slightly, after which the SEPP expires on 1 July 2025. For zero-emission company cars, the SEBA subsidy of €5,000 is available until 31 December 2024.
Investment Deduction
At the end of 2023, the most recent Energy and Environmental List was published. These lists include business assets eligible for the Energy Investment Allowance (EIA) and the Environmental Investment Allowance (MIA). The EIA and MIA are tax benefits in the form of an additional deduction for entrepreneurs who invest in energy and environmentally friendly business assets. It should be noted that hydrogen-powered mobile equipment, electric taxi cars and (certain) charging stations are no longer on the current list for the EIA and MIA. Furthermore, the EIA percentage has been reduced from 45.5% to 40% as of 1 January 2024. The MIA percentages, which depend on the degree of environmental friendliness of the asset, remain the same and range from 27% to 45%. Whereas the budget for the EIA was increased to €259 million, the budget for the MIA remained unchanged.
Charging infrastructure and hydrogen refueling stations
Charging infrastructure for electric and plug-in hybrid electric cars plays a crucial role in the energy transition within the mobility sector. In addition, building a network of hydrogen refueling stations is an important development. The growth of this infrastructure is hampered by challenges in the energy sector, personnel shortages, and procedural delays. The Dutch government is working on subsidy schemes to solve various bottlenecks in the context of the goals set out in the Climate Agreement.
Consultation subsidy private charging infrastructure
This consultation concerns a subsidy scheme for private charging infrastructure at companies. The aim is to realize more private charging stations by providing financial support for advice on the realisation of charging infrastructure and part of the investments for its construction and realisation. The consultation period started on 4 March 2024 and runs until 31 March 2024.
Consultation subsidy public charging infrastructure heavy vehicles
A second consultation concerns a subsidy scheme for publicly accessible charging infrastructure for electric trucks. The aim is to accelerate the rollout of logistics charging infrastructure by providing investors with subsidies for publicly accessible heavy vehicle charging points to promote the transition to zero-emission freight transport. The consultation period ends 17 March 2024.
Subsidization Scheme Hydrogen in Mobility
Earlier, the legislature consulted on a subsidy scheme to promote hydrogen refueling infrastructure and its uptake by transporters. The government sees hydrogen as a full-fledged option alongside battery-electric transport in the transition to zero-emission mobility, especially in heavy logistics transport.
Truck tax
The Dutch government is in the process of implementing a new "truck tax." This tax, expected to take effect in 2026, will apply to the use of Dutch roads by trucks (weighing more than 3,500 kilograms), regardless of whether they are registered in the Netherlands or abroad.
The charge will be calculated based on the number of kilometers driven on Dutch highways and certain local and regional roads. The amount of the charge depends on the environmental performance and weight of the truck: the more environmentally friendly and lighter the truck, the lower the charge. This brings the Dutch truck charge in line with the systems in Germany and Belgium. Rates in the Netherlands will range from €7.8 cents to €26 cents per kilometer driven, with an average rate of about €15 cents.
With the introduction of the truck tax, the tax on heavy motor vehicles (the 'Eurovignet') will be abolished in the Netherlands and the motor vehicle tax for trucks will be reduced to about the European minimum. The proceeds will be used to make the transport sector more sustainable and innovative. For example, part of the revenues will be used for the subsidy scheme for private charging infrastructure mentioned above.
For private kilometers driven, the government also envisions a kilometer charge (pay according to use). In fact, it is still envisioned that motor vehicle tax will transition from a tax on car ownership to a system based on use by 2030. This transition is motivated by emission reduction, but also has the purpose of maintaining revenues from automotive taxes, taking into account the expectation that certain taxes and excise duties revenue will decline in the future.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
