Anyone wishing to benefit from the 0.25% rule for company cars must currently opt for an electric vehicle with a maximum gross list price of €60,000. Employees who have to pay tax on the non-cash benefit of private company car use currently have the option of opting for flat-rate taxation. In this case, 1 percent of the purchase price is assessed as a non-cash benefit each month. For high-priced electric and hybrid vehicles, this percentage is currently 0.5 percent of the gross list price.
The German government is now planning to adjust the taxation of privately used electric company cars by raising the gross list price relevant for the 0.25 percent rule from 60,000 to 80,000 euros. This step, which is provided for in the draft Growth Opportunities Act, is intended to ensure that high-priced electric vehicles are also increasingly considered as company cars. The planned change stipulates that electric company cars in the price range of 60,001 to 80,000 euros will in future be subject to a reduced tax rate of 0.25 percent instead of the previous 0.5 percent. However, the draft law still has to go through the usual committees before it can come into force.
Of course, there are also negative voices from various organizations. Deutsche Umwelthilfe (DUH) has expressed concerns about this regulation and warns that it could create additional incentives for the purchase of large, heavy and overpowered electric company cars. Instead, DUH is calling for the plans to be rejected and for the company car privilege to be abolished in order to end the financial incentives for private company car use. DUH Federal Managing Director Jürgen Resch describes the proposal as "madness" and accuses the German government of supporting the withdrawal of German car companies from affordable small and compact cars while at the same time promoting overpowered electric SUVs.
