The Government of Ireland is set to introduce new measures in the upcoming October Budget to make electric cars more affordable for consumers. One of the proposed measures is the abolition of the Vehicle Registration Tax (VRT) for electric battery cars. Additionally, a new grant for first-time electric car buyers may also be introduced.
Last year, the government reduced the grant for electric cars from €5,000 to €3,500, a move that many ministers now believe was a mistake. The grant was previously offset against the VRT and funded through the Sustainable Energy Authority of Ireland. However, in a bid to encourage more drivers to choose electric vehicles, the government is now prepared to provide funding to support these measures.
The aim is to tackle the perception that electric cars are too expensive, with prices ranging between €40,000 and €50,000. By eliminating the VRT and potentially offering a new grant for first-time electric drivers, the government hopes to reduce the cost barrier and facilitate increased adoption of electric battery vehicles. This is seen as a crucial step in reducing the country’s greenhouse gas emissions.
Currently, there are around 34,000 electric cars in Ireland, excluding hybrid models. This number is relatively small compared to petrol cars, which make up 32.6% of the market, followed by diesel vehicles at 22.8%. However, it’s worth noting that Ireland saw a record number of electric cars registered in 2021, with 15,462 vehicles, an 81% increase from the previous year.
Internationally, China leads the way with over seven million electric cars, while Germany has the highest number of electric vehicles in Europe, with over 350,000 on its roads. In Ireland, electric cars benefit from the lowest road tax rate of €120 per annum.
These new measures announced by the Irish Government aim to address the affordability of electric cars and make them a more accessible option for consumers, ultimately contributing to the country’s efforts to reduce emissions and transition to sustainable transportation.