New vehicle taxation 2021: What it means for you as a driver
On the 9th of February 2021, the Danish government adopted new legislation for vehicle taxation applicable this year and valid for the next five years. The new legislation favours electric vehicles and plug-in hybrids rather than conventional cars and non-chargeable hybrids. Here is what the new vehicle taxes for passenger cars mean to you as a driver or fleet manager.
We have composed a short presentation in which you will get an overview of the most important changes, how they will affect you and how they are calculated. You can download it below.
In short:
- The new taxes will become effective on June 1, 2021, with retroactive effect going back to December 18, 2020
- The tax model is divided into two parts - it runs until 2030 with adjustments in 2025
- COâ‚‚ surcharges will have significant impact on the car price moving forward
- New factors like "phasing in" and "bottom deduction" will have an impact on electric and plug-in hybrid car prices
- Privately installed charging stations are exempt from taxation starting July 1, 2021
- Green tax for diesel cars will be calculated based on COâ‚‚ emissions instead of kilometres per liter starting July 1, 2021
What it means to you as a driver
The limit for when to pay registration tax on an electric car has been raised from DKK 400,000 to DKK 500,000. Though, the tax rebate introduced in 2020 will not be continued in 2021.
When we look at plug-in hybrids, they will be more expensive in the middle segment, while the premium brands will experience a price drop. Unchargeable hybrids are more or less equated with traditional petrol and diesel engines.
Recalculation still needs to be conducted
The rule about recalculation within 4 months is still valid in the new legislation.
No taxation on at home charging stations
From July 1st, privately installed charging stations paid by your employer are no longer subject to taxation.
How to calculate taxation on vehicles will change
The rates used for calculating the taxation on cars below and above DKK 300,000 will change towards 2025, where they will fall and rise 0.5% respectively each year and end up at 22.5% for both rates from the current 25 and 20% respectively.
Increasing environmental surcharges
From 1th of July 2021 the environmental surcharge will increase gradually over the coming years. This means that it will become more expensive to drive a petrol or diesel car compared to plug-in hybrids and electric vehicles.
CO2 emissions will be a key factor for the price of the car
The price of the car will now be calculated based on it’s CO2 emission, this applies to both the car's registration tax and the green tax. This will make petrol and diesel cars more expensive. For plug-in hybrids it can go both ways, the key figure is 50 grams of CO2 per. km. If your plug-in hybrid car emits less than that, it will be cheaper. If it emits 50 grams of CO2 per km or more it becomes more expensive.
About vans in particular
Shortly we will also offer a specific guide on the new legislation for vans. In a few words it means that:
- In general vans will be more expensive, especially light commercial vehicles
- Only one registration tax on 50 % (30 % will no longer apply)
- New COâ‚‚ charge
- Unit tax (stykafgift) on vans over 3 tonnes can amount to a maximum of DKK 47,000, which can lower the price on large vans.
We are ready to help you by phone and email, but you may expect a longer response time these days due to the new legislation, which of course raise many questions. We thank you in advance for your patience and understanding.