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Decision Nears on Germany’s EV Car Tax Exemption as 2026 Cutoff Looms

The review tests a coalition pledge to keep electric cars tax‑free until 2035.

Overview

  • Under current law, battery‑electric cars first registered by 31 December 2025 remain exempt from motor‑vehicle tax for up to ten years but no later than 31 December 2030.
  • If the exemption is not extended, new EVs registered from 1 January 2026 would pay the regular weight‑based Kfz‑steuer, with estimates of about €50 a year for a BMW i3 and over €150 for heavy electric SUVs.
  • Finance Minister Lars Klingbeil is assessing revenue options, and a signal on the policy is expected in discussions planned with industry and unions at an upcoming Autodialog.
  • Auto industry chief Hildegard Müller warns that letting the break lapse could leave fully electric cars taxed higher than plug‑in hybrids, risking confusion and dampening demand.
  • Analysts foresee a late‑2025 registration rush followed by a slump, while the ADAC argues that lower purchase prices, cheaper charging and reliable local infrastructure would do more to boost uptake than the tax waiver alone.