Incentives and Legislation
The incentives and legislations section is updated for 2025, published on 18th April 2025, representing the situation as of that date. Major changes of incentives and polices are updated on a rolling basis from that date onwards.
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. We review the proposed changes and implement the updates on a short notice.
The incentives and legislations section is updated for 2025, published on 18th April 2025, representing the situation as of that date. Major changes of incentives and polices are updated on a rolling basis from that date onwards.
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. We review the proposed changes and implement the updates on a short notice.
- Purchase subsidies
A maximum subsidy of €6,000 is available for new BEVs with an energy consumption of less than 16 kWh/100 km.A reduced subsidy of €3,000 is provided for BEVs with an energy consumption between 16 kWh/100 km and 18 kWh/100 km.BEVs with an energy consumption exceeding 18 kWh/100 km are no longer eligible for purchase subsidies.
A €1,500 subsidy is available for second-hand BEVs that are at least three years old.
Eligibility Criteria:The vehicle must be 100% electric and meet the energy consumption thresholds mentioned above.The subsidy applies to vehicles that are first registered in Luxembourg and have never been registered abroad.The minimum ownership period for subsidized vehicles has been increased to 36 months starting from October 1, 2024.
Special Provisions for Large Families:Families with five or more members can claim an additional subsidy of €6,000 for BEVs with seven or more seats.
Hydrogen Fuel Cell Vehicles (FCEVs):FCEVs are eligible for a subsidy of €8,000, provided they meet similar energy consumption and registration criteria
- Registration Tax Benefits
BEVs benefit from a 50% reduction in administrative tax.
- Ownership tax benefits
BEVs benefit from a significant reduction in ownership tax due to their zero CO2 emissions. The minimum tax for BEV M1 vehicles is set at €30.
BEVs and Fuel Cell Electric Vehicles (FCEVs) registered by December 2025 are exempt from the annual ownership tax for the first five years after registration.After the initial five-year exemption, BEVs will pay only 25% of the standard ownership tax rate.
- Company tax benefits
Expenses related to the purchase, maintenance, and use of BEVs as company cars are 100% tax-deductible until 2026.Companies benefit from a reduced taxable base for BEV company cars, which is set at 10% for BEVs.BEVs and FCEVs registered by December 31, 2025, are eligible for a ten-year property tax exemption, further incentivizing their adoption.Luxembourg offers a tax credit for investments in sustainable mobility.
- AF Infrastructure Incentives
The government has decided to stop subsidising the Chargy tariffs. New prices have been in force since 1 March 2025. At Chargy stations, they have been increased from 36 cents/kWh in 2024 to 48 cents/kWh this year, and at SuperChargy stations, they have even increased from 48.50 cents/kWh to 62 cents/kWh.
- Announced policy changes (effective later in 2025 and after)
By 2030, the government wants to increase the percentage of new EVs registered to 49 percentage points.
The VAT deduction for BEVs will be maintained until 2027. This allows companies to continue deducting input VAT for the purchase of passenger (M1) electric cars up to €50,000 (including VAT) per vehicle.
- Institutions involved in Incentives
- Ministry of the Environment, Climate and Sustainable Development
- Ministry of Mobility and Public Works
- Interesting links