As you may have noticed in the current energy crisis and the associated rise in fuel prices … The Portuguese state makes a lot of good money selling fossil fuels at the many gas stations across the country!
In fact, Portugal is one of the countries with the highest tax burden on a single liter of fuel, be it gasoline or diesel. Which begs a question … What happens to the state’s revenue as electromobility gains even more popularity and the number of fossil fuel vehicles begins to decline?
In our small and old Portugal, the state not only collects good money in fuel, there is also an excessive tax on the purchase of 0 km vehicles.
Well, we are already seeing a very strange example of what could happen if the aid for the purchase of electric cars were maintained or improved in the near future to increase their adoption.
Fuels: Is that the influence of electric cars on the state coffers?
So if we look at Norway we have an excellent example of what could happen to the Portuguese national budget in the near future. Because in a very curious way this is a country that is on a different level when it comes to the introduction of electric mobility. In the end, in 2021, the share of electric vehicles will be over 63%, plug-in hybrids 22%. In other words, we are talking about 85% of electrified vehicles that need to be plugged in to be fully functional.
It’s a country all by itself and of course, in many ways, shows us a little bit of the future.
The Norwegian car market is not large (it has a little over half the population of Portugal), but Norway is in a “world of its own” in terms of sales of electric vehicles.
Do you know why? Because in Norway most taxes and fees were abolished or reduced, so that electric cars were competitively priced compared to combustion cars. In fact, in some cases it is even more beneficial to buy an electric car than a gasoline car.
In addition, electric cars in Norway do not pay parking fees, no tolls and are allowed to use the BUS lane in cities. All measures that have won over consumers and, of course, have changed the way everything works in the country.
But of course all of this led to falling tax revenues!
Well, of course, Norwegian tax revenues should drop very significantly, which apparently means less than 1.91 billion euros a year. Value that should increase, since most of the measures are to be retained! Because despite the current trend in buying electrified cars, the truth is that in the entire vehicle fleet, only 15% of the fleet in circulation is electric.
Yes, we said most of the measures because the current government wants to change a few things. As with the toll exemption that expired in 2017. In order not to endanger the goal of ending the sale of combustion cars by 2025, it is very likely that the “help” measures will come to an end in plug-in hybrids and only later in 100% electric vehicles.
Besides, what do you think of all of this? What will happen in Portugal to balance the scales? An increase in electricity taxes? Other taxes? Please let us know what you think in the comments below.