The incentives and legislations section is updated for beginning of 2024, as of 23rd April 2024.

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, or use the button on the right, and let us know.

Ownership tax benefits

10-year exemption for BEVs and FCEVs registered until 31 December 2025. Exemption granted until 31 December 2030.

Exemption from the annual circulation tax for vehicles emitting ≤ 95g CO2/km.

Company tax benefits

Reduction of the taxable amount for BEVs and PHEVs (from 0.5-1% of the gross catalogue price per month). PHEVs must meet further requirements, which become more stringent over time. Additional reduction of taxable amount for BEVs with a gross list price up to €60,000 (0.25-1% of the gross catalogue price per month).

Purchase subsidies

Since 1st January 2024, purchase subsidies ended, as mandated by the Federal Office of Economics and Export Control (BAFA).

Other financial benefits

To reduce the tax disadvantages of electric vehicles provided as company cars, the German government has implemented a tax adjustment for electric company cars that applies to both the 1% regulation and the driver’s logbook method. For practical reasons, this is implemented as standard, in the form of a flat-rate deduction.

For electric vehicles that are handed over to an employee for private use for the first time after 31 December 2018, only half of the gross catalogue price will serve as taxation base. As a result, for users of an electric company car the taxable amount is 0.5% of the gross catalogue price per month. The halving of the tax base also applies to the distance between the residence and the office of the employee. Under certain circumstances the same applies to journeys to the employee's home base.

The regulation will apply for ten years, ie until 31 December 2030. In addition, externally rechargeable hybrid vehicles, ie plug-in hybrids (PHEVs), will also benefit from the tax reduction if the PHEV emits a maximum of 50g of CO2/km or has an electrical range of at least 40km. This range requirement applies until 31 December 2021, subsequently it will be increased to 60km. From 1 January 2025 it will increase to 80km. For all other PHEVs, the existing deduction continues to apply. For electric vehicles with a gross list price of up to €40,000 only one quarter of the gross catalogue price will serve as taxation base. In this case, the taxable amount is 0.25% of the gross catalogue price per month.

The regulation does not apply only to new cars. Used cars can also be covered if they are handed to the employee as a company car for the first time from January 2019.

AF infrastructure incentives

€130 billion for infrastructure development, tax cuts, and further subsidies.BEV owners are exempt from declaring charging their cars at their employer's premises as a cash benefit in their income tax return.900 EUR residential support program is no longer available. 

VAT benefits

No VAT reduction.

Local incentives

The environmental bonus may also be combined with various other public funding programs. However, most of these programs are not aimed at private individuals, but at companies, municipalities or associations.

Interesting links

ADAC

BMWK

BAFA

National Platform Electromobility

Mobility Observatory

BMVI

https://now-gmbh.de

https://dlr.de

ACEA

Announced policy changes (effective later in 2024 and after)

Since 1st January 2024, purchase subsidies ended, as mandated by the Federal Office of Economics and Export Control (BAFA).

Announced changer prior 2024:
From January 1, 2023 , funding for electric vehicles should only focus on motor vehicles that have a proven positive climate protection effect. In concrete terms, this means that only battery and fuel cell-powered vehicles will be subsidized with the state environmental bonus . The manufacturers' share is to continue to account for 50 percent of the total federal subsidy in the future and to be added when determining the total subsidy. The tax advantages of electric cars in the company car regulation should also be retained .

Funding from January 1st, 2023
From January 1st, 2023, plug-in hybrid vehicles will no longer receive funding from the environmental bonus.

From January 1st, 2023, the federal share of funding for battery electric vehicles and fuel cell vehicles with a net list price of up to 40,000 euros instead of 6,000 euros will then be 4,500 euros , with a net list price between 40,000 euros and up to 65,000 euros instead of 5,000 euros only 3,000 euros. Electric vehicles with a purchase price of more than 65,000 euros will continue to receive no funding.

From September 1st, 2023 , funding will be limited to private individuals . An extension to small businesses and non-profit organizations is currently being examined.

Funding from January 1st, 2024
From January 1st, 2024, the federal share of funding for battery electric vehicles and fuel cell vehicles with a net list price of up to 45,000 euros will only be 3000 euros .

Vehicles with a net list price of more than 45,000 euros will no longer receive funding .

Important for everyone who is flirting with the purchase of an electric vehicle : The Ministry of Economics is planning a subsidy cap. A total of 3.4 billion euros is available for the promotion of pure electric cars : 2.1 billion euros for 2023 and 1.3 billion euros for 2024.

Institutions involved in Incentives

National Platform Elektromobilitaet, (NPE), das Bundesministerium für Verkehr und digitale Infrastruktur (BMVI)