Norway is not a member of the EU. But the country has joined the EEA cooperation and must therefore ask for a law to remove the VAT on electric cars – again!
Norway has requested permission to continue exempting electric cars from VAT, a scheme that has been in place for several years.
The background for the request is the desire to continue the policy that has contributed to the spread of electric cars in the country. The VAT exemption is considered state aid and therefore requires approval from EFTA's monitoring body (Esa), so that it does not contravene the rules of the EEA Agreement.
On Friday, the Ministry of Finance sent an official notice to Esa with a request to extend the exemption.
This is written by the NTB news agency and the Norwegian Electric Vehicle Association .
Norway has already been given permission to maintain the scheme until the end of 2024, but the government now wishes to extend the period to also include 2025 and 2026.
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Finance Minister Trygve Slagsvold Vedum (Sp) has stated that it is important for the government to ensure that ordinary households have the opportunity to purchase a car.
The government therefore wishes to take advantage of the opportunities available within the EEA agreement to ensure that the policy for electric carriages can continue without significant changes.
According to the current rules, the VAT exemption covers the purchase and leasing of electric cars with a price of up to DKK 500,000. For amounts that exceed this limit, VAT is calculated at the normal rate. The Norwegian Ministry of Finance has stated that this model has been developed to ensure a balanced and socially responsible approach to the VAT exemption.
The request from Norway must now be assessed by Esa, which has previously approved similar requests from the Norwegian government. A decision from Esa is expected to have a major impact on how the market for electric cars will develop in the coming years.
However, Norway does not only cater for electric cars. In fact, the government also wants to make the car type more expensive from next year. Read more about it here .
On the other hand, the then government of the Norwegians chose in 2019 to exempt all cars from all taxes as soon as they are 20 years old. The cars that is. Not the owners.
