Subsidize more electric cars, say auto associations

With reporting by Demid Getik.

A coalition of auto associations sent a letter to the cabinet outlining an alternative taxation plan for the domestic car market and a 250 million euro annual fund to stimulate growth of alternative energy automotive sales. The plan should launch by 2017 in order for the cabinet to reach the Netherlands goal of having 200,000 reduced emissions cars on the road by 2020, the associations say, and could be achieved by raising the tax rate on most cars to between 20 and 21 percent of purchase price.

They are calling on lesser market distortion, greater simplicity of regulation and more incentives for producers of electric cars. Those vehicles would only be subject to a seven percent tax up to 50 thousand euros under such an arrangement, the organizers claim.

"The ANWB wants electric cars to become available to private motorist, the approach for which would be to given them a purchase subsidy and exempt them from road tax," Frits van Bruggen, CEO of ANWB auto association said. "That is good for their wallet and the environment."

In addition to incentivizing private purchases of cars that produce less than 50 grams of carbon dioxide per kilometer, the organizations want business purchases of those cars to become easier, and reforms to the tax system to add more simplicity to the process. The government should promote not only all-electric vehicles, but also hybrids and hydrogen fuel-cell cars, the organizations said in their letter.

Aside from the motorist union ANWB, the organizations BOVAG, Natuur & Milieu, and RAI put together the proposal.