End of the road for electric car grant for company cars

The Government has ended the €3,800 grant for businesses purchasing electric cars or plug-in hybrids, in a decision seemingly at odds with efforts to encourage the move to electric transport.

The grant, administered by the Sustainable Energy Authority of Ireland (SEAI), was on top of the €5,000 tax rebate on Vehicle Registration Tax (VRT) on full-electric vehicles.

A zero per cent rate of benefit-in-kind tax is applied to employees opting for full-electric vehicles. This rate has been extended to 2022.

The Department of Environment said the decision to discontinue the €3,800 for companies buying electric cars and plug-in hybrids was because “the generous benefit-in-kind tax relief that is available for these vehicles is considered adequate incentive to drive growth in this sector”.

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The changes apply to all applications received from Wednesday, October 23rd. This gives consumers two weeks to apply for purchase grants under the existing rules – provided that the vehicles are registered and the grant claimed before the end of 2019.

Funding

The €3,800 grant will continue for companies purchasing electric vans.

Meanwhile, there has also been changes to the grant systems for hybrids. From October 23rd, the €5,000 SEAI grant will only apply to plug-in hybrid vehicles with CO2 emissions below 50g/km and that can travel on fully-electric mode for a minimum of 50km.

The changes were announced as part of a wider range of budget measures relating to electric vehicles. Minister for Finance Paschal Donohoe announced additional funding of €8 million for electric vehicle purchase grants, bringing the total allocated in 2020 to €14 million.

A further €3 million has been allocated for new electric vehicle charging infrastructure, bringing the total budget for the department to €6 million, in addition to €10 million support to develop the public charging network from the Climate Action Fund.

There was also €1.5 million allocated to the Department of Transport to roll out fast-charging points to taxi ranks at transport hubs.

The department also said that next year it will introduce new regulations to require new buildings with more than 10 parking spaces to provide for the installation of charging points and, from 2025, non-residential buildings with over 20 car parking spaces to install charging facilities.