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European Alternative Fuels Observatory

Denmark

Incentives and Legislation

Incentives and legislation that aim to increase uptake of alternative fuels vehicles and infrastructure. 

If you know of other national or local incentives that should be included in this section, please send us an email and let us know.

Registration tax benefits

Zero-emission vehicles:

  • Pay 40% of registration tax
  • Additional DKK 167,500 registration tax deduction
  • DKK 1,300 deduction of taxable value

Low-emission vehicles (emitting < 50g CO2/km):

  • 50% of the full registration tax
  • Additional DKK 48,750 registration tax deduction
  • DKK 1,300 deduction of taxable value

All consumption figures will be based on WLTP as of 1 January 2021.
Hydrogen-powered and fuel-cell electric vehicles (FCEVs) are exempt from registration tax until the end of 2021.

Further deductions for LCVs.

Ownership tax benefits
  • Taxes on ownership are based on CO2 emissions.
  • Zero-emission cars pay the minimum semi-annual tax rate of DKK 340.
Purchase subsidies

It was possible to get a subsidy for new BEV or FCEV truck. The grant covers up to 60 % of the additional price for an electric truck compared to a diesel truck. Large companies can get 40 % covered, medium-sized companies 50 % and small companies 60 % of the additional price. The pool is a total of DKK 45 million DKK. The Danish Energy Agency must receive applications for subsidies for electric trucks. Applications were open from 15 August to 14 October 2022. The applicants will receive an answer in mid-December 2022.For more information.

Other financial benefits

The Danish government issued a rule exempting electric cars from parking fees for up to DKK 5 000 (EUR 670) per year (Flader, 2017). In practice, this means that other than in Copenhagen, electric car owners rarely pay for public parking.

In 2020 a temporary deduction in the annual taxation of DKK 40 000 (3 333 per month) is granted for BEVs and PHEVs, but only during the period from 1 April 2020 until 31 December 2020.
In Denmark there is a CO2 tax of DDK 175,3 per tonne of CO2. BEV´s and PHEV´s are not subject to this tax. This indirectly supports these cars. For petrol this tax is DDK 5 per litre and for diesel this is DDK 5.4 1per litre (both including VAT). Also the energy tax is higher than the European minimum. The energy tax for petrol is DKK 5.33 per litre (when blended with bio-fuel this is DDK 42.65). For diesel the rate is DKK 3.43 (when blended with bio-fuel this is DDK 27.42). BEV's and PHEV's are no subject to this.

A private person is eligible to obtain a basic deduction of DKK 10 700 (2021 level) for renting a petrol or diesel-powered car and a basic deduction of DKK 20 000 (2021 level) for renting a zero or low emission car, eg. an electric car.

AF infrastructure incentives

Since 2016, Denmark offers a tax exemption for commercial charging, which in 2017 was extended to 2019, and favourable tariffs for electric buses were extended to 2024 (Government of Denmark, 2017).

The Executive Order on Chargers provides several provisions for companies and municipalities on establishing chaging stations. In existing buildings with more than 20 parking slots, at least 1 charging station must be connected to the parking facility. In buildings with more than 10 parking slots, that are undergoing major renovation, at least 1 charging station must be established and at least every fifth converted parking space prepared for charging stations. In case of new constructions, buildings with more than 10 parking spaces that are not residential buildings must establish at least 1 charging station.