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What is the additional tax for electric cars in 2024? And what about 2025 and 2026?
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Time to read 3 min
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Time to read 3 min
Electric cars are rapidly gaining popularity in the Netherlands, thanks to their minimal impact on the environment and lower operating costs. With the government introducing incentives to promote sustainable transport, more and more people and companies are considering going electric. A crucial factor in this consideration, especially for business drivers, is the additional tax. This tax aspect can significantly impact the total cost of ownership of a car, making it an important consideration when purchasing new vehicles.
Additional tax is a tax levy for the private use of a business car. In the Netherlands, a percentage of the car's catalog value is added to the driver's annual taxable income if he also uses the car outside of work. Suppose the list value of an electric car is €40,000 and the additional tax rate is 8%, then the additional tax is €3,200 per year.
This amount is added to the taxable income of your salary, meaning that the driver pays tax on this amount according to his tax bracket. For business drivers, the low additional tax is therefore an important cost factor to take into account when choosing a car. There is a lower additional tax for an electric car than for a new fuel car. The difference in percent additional tax will be 6% in 2024, the additional tax for an electric car is 16% while the regular additional tax is 22%.
Until 2024, electric cars enjoyed a reduced additional tax rate as an incentive for sustainable driving. This scheme made electric cars financially more attractive for business users by reducing the additional tax and therefore the tax burden. The gradual adjustments in the additional tax rate over the years reflect the government's commitment to making electric driving more accessible, while at the same time gradually phasing out tax benefits in response to the growing market for electric vehicles.
Electric vehicles (EVs) enjoy a significantly lower additional tax rate compared to new fuel-powered vehicles. Until the year 2024, an additional tax rate of 16% will be applied to EVs on the first €30,000 of the list value. This percentage will increase slightly to 17% in 2025. From 2026, the additional tax percentage for electric cars will be equal to that of cars that run on fossil fuels, unless new legislation is introduced that changes this.
However, this does not mean that all owners of electric vehicles will be obliged to pay the standard additional tax in 2026. The fixed percentage applies for a period of 60 months. The year 2025 offers the last opportunity to purchase a new electric car at a reduced additional tax rate, where you can then enjoy a rate of 17% for five years.
For electric cars with a value above €30,000, the additional tax rate of 22% is applied to the amount that exceeds this limit (the total cost of the car minus €30,000).
The adjustment in the additional tax could affect the growth of the electric car market. Potential buyers may be encouraged to bring forward or reconsider their purchase depending on the financial impact. For business drivers and their employers, this means a rethink of their vehicle policy, with a focus on the total cost of ownership and the environmental benefits of electric vehicles.
As the surcharge for electric cars normalizes, it is likely that the emphasis will shift to other factors, such as total cost of ownership, availability of charging infrastructure, and environmental impact. Business drivers and companies should also keep an eye on the rules for additional tax in 2025 and 2026, as the government can adjust its policy to support or accelerate the sustainable mobility transition. The reduced additional tax for a fully electric car will probably be equal to the applicable additional tax rules for a petrol company car by 2026.
The additional tax for electric cars in 2024 marks an important moment in the transition to sustainable mobility. While tax benefits are diminishing, the underlying trend towards fleet electrification remains strong. It is crucial for business drivers and their employers to understand these changes and adapt to the evolving landscape of sustainable mobility in the Netherlands. Therefore, enjoy the net addition for your electric car as soon as possible before the remaining amount is reduced!
