page_title: Plug-in electric vehicles in Norway
section_title: Phase out of incentives
hierarchical_section_title: Plug-in electric vehicles in Norway / Government goals and incentives / Existing incentives / Phase out of incentives
caption_attribution_description: English: Dedicated parking lot for EVs in Oslo, Norway.
context_page_description: The fleet of plug-in electric vehicles in Norway is the largest per capita in the world. In March 2014, Norway became the first country where one in every 100 passenger cars on the road was a plug-in electric; the market penetration passed 5% in December 2016, and attained 10% in October 2018. The Norwegian plug-in car segment market share has been the highest in the world for several years, achieving 29.1% in 2016, 39.2% in 2017, 49.1% in 2018 and 55.9% in 2019.
  As a result of the fast rate of adoption, the Nissan Leaf was Norway's best selling new passenger car model in 2018, marking the first time in any country that an all-electric car tops annual sales of the passenger car segment. According to a 2018 analysis by McKinsey & Company, Norway has already reached a critical mass of electric vehicles, therefore, the country is the only one in the world in the third stage of a disruptive trend, and the EV disruption is inevitable.
  As of 31 March 2020, the stock of light-duty plug-in electric vehicles registered in Norway totaled 390,367 units in use, consisting of 268,962 all-electric passenger cars and vans, and 121,405 plug-in hybrids.
context_section_description: As one of the criteria to end the incentives was achieved, as of April 2014, no decision was made by the authorities about the reintroduction of the 25% VAT on purchase of electric vehicles. Among the options considered by the government were to introduce the tax in a step-wise fashion. However, Prime Minister Erna Solberg announced the government decided not to make any changes about the electric car benefits in the 2015 budget.
  In early March 2015, negotiations began among parties represented in the Parliament to define the future of all motor vehicles and fuel taxes. The Liberal Party wanted all the benefits to continue beyond the established quota. The Ministry of Finance also made a comprehensive review of all motor vehicle taxes. The two purchase tax exemptions cost the government about 3 billion kroner  (around US$480 million) in lost revenue just in 2014, and up to 4 billion kroner  (around US$640 million) if all the other benefits are accounted for. In May 2015, the Government decided to keep the existing incentives through 2017, and the political parties in Parliament agreed to reduced and phase out some of the incentives. Beginning in January 2018, electric car owners will be required to pay half of the yearly road license fee and the full rate as of 2020. The value-added tax (VAT) exemption for electric cars was scheduled to end in 2018, but replaced by a new scheme, which may be subjected to a ceiling that could be reduced as technology develops. The agreement also gave local authorities the right to decide whether electric cars can park for free and use public transport lanes.
  In March 2016, the Ministry of Transport issued new regulations for parking in locations with access to the general public. The new parking regulations, that went into effect on January 1, 2017, terminated the free parking for zero-emission vehicles, but established that Municipalities are allowed to introduce payment exemption for electric and hydrogen powered motor vehicles on municipal parking locations. As of September 2016, the city councils of Trondheim and Tønsberg decided to introduce full payment for EVs from 2017; the cities of Bodø and Tromsø introduced payment for parking in downtown but exempted parking outside the city's center; and the cities of Oslo, Mandal and Drammen decided to keep free parking for zero-emission vehicles. As of January 2018, 24 out of 58 major municipalities kept the free parking for EVs. Among the 34 municipalities that terminated the benefit, six kept different variants of partial free parking.
  For the 2017 National Budget, the Government proposed to extend the VAT exemption for zero-emission vehicles until 2020. It also put forward a national rule to keep a maximum tax rate of zero-emission vehicles equal to half the value charged to conventional cars. The budget proposal also included an adjustment to exempt plug-in hybrids from the higher taxes levied to heavier vehicles, and instead, to charge taxes based on their fuel economy under the New European Driving Cycle (NEDC). Until 2016, all plug-in hybrids had a weight allowance of 26% regardless of their all-electric range or fuel efficiency.
  In October 2017, the National Government proposed in its 2018 Budget a new tax for EVs based on weight. This proposal would affect mainly bigger electric car models, all Tesla vehicles, and in particular the Tesla Model X. After some public controversy, the proposal was dropped. Nevertheless, Tesla's sales surge at the end of 2017 for consumers' fear of the introduction of the new tax.
caption: All-electric cars at a free parking lot reserved for charging in Oslo (2018), which kept the perk. Since January 2017, free parking for EVs was terminated in 34 major municipalities.[74]
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