Overview

• Finance Minister Lars Klingbeil announced he will present legislation to keep pure electric cars exempt from the vehicle tax, targeting an extension through 2035.
• Under the proposal, cars first registered by December 31, 2030 would qualify for up to ten years of exemption, capped no later than December 31, 2035 to encourage earlier purchases.
• Without a new law, the current break for newly registered EVs would end on January 1, 2026, with vehicles registered by December 31, 2025 retaining the existing exemption for up to ten years but not beyond the end of 2030.
• The auto industry’s VDA had urged an extension, warning that letting the exemption lapse would slow electrification and could leave full EVs taxed more heavily than plug‑in hybrids.
• Chancellor Friedrich Merz has called an auto summit for Thursday, and the tax measure is set to be one element of the government’s support package for the sector.