Electric Mobility Boost: Olaf Lies Touts Affordable E-Cars and Tax Breaks
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Chopping the cost of electric vehicles (EVs) is key to making them economically advantageous for everyone, asserts Lower Saxony Minister President Olaf Lies. "Our objective is to ensure electric vehicles (EVs) offer financial benefits for all," the SPD politician and Volkswagen supervisory board member expressed to the German Press Agency. "With cheaper electricity rates, EVs are already more cost-effective compared to combustion engines for many today," Lies elaborated. "Yet, the topic seldom arises. People still believe: EVs are too expensive, their range is insufficient, and the battery life is poor. This perception is outdated in many instances today."
Lies further stated, "I'm not implying everyone should drive electric. But I am stating: One should be able to afford mobility tomorrow. In a future e-mobilized world, direct electricity usage is the only way to achieve that."
Lies urges swift action on EV tax incentives
While lower electricity prices can make e-mobility more appealing, politics should act to make EVs even more alluring beyond cheaper electricity prices, Lies commented. He welcomed the federal government's initiatives concerning tax incentives for electric mobility as important, adding, "We need precise information and quick execution."
Beyond affordability, Lies also emphasized the need to safeguard manufacturing in German sites. "This can't function if we cater solely to the dwindling market for combustion engines," he said.
The Minister President personally possesses three old Volkswagen vehicles – all combustion engines. However, he transitioned to exclusively electric vehicles professionally years ago.
"Extreme consumption restraint" plagues VW
Regarding the Volkswagen crisis, Lies detailed that the company's renewal process will be intensified over the coming years. "The EV platform is prepared. The upcoming EV models will cater to diverse customer segments, including budget-conscious ones," he predicted.
Despite its emphasis on EVs, Volkswagen offers more than just electric vehicles, Lies added. "I have confidence: Volkswagen is on the right track – given the market recovers. We're enduring extreme consumption restraint. People aren't buying because they're unsure about the future. To achieve economic stability, we need it." With an economic rebound, people would also purchase more vehicles again.
A financial boost for EV adoption
Germany has recently announced several proposals for tax incentives to drive the adoption of electric vehicles (EVs). Here's a rundown of the key measures:
- 75% Company EV Tax Write-Offs: Germany plans to introduce a 75% tax write-off for new electric vehicles purchased by companies, with the aim of making EVs more appealing tax-wise, thereby encouraging corporate purchases [1][2].
- Special Depreciation Starting July: This special tax write-off is set to begin as early as July 2025. While depreciation for machinery will remain at 30% for the years 2025, 2026, and 2027 [1][2].
- Wider Corporate Tax Breaks: As part of a broader economic stimulus package, Germany has allocated $52 billion in corporate tax breaks, which includes incentives for companies to buy electric vehicles and equipment, with the aim of boosting investment in the country and driving its economic recovery [3].
- Socially Fair EV Rollout: Reports suggest that the government could roll out support for EV purchases in a socially fair manner without placing an additional burden on public coffers. This could involve financing price reductions for EVs and low-income leasing options by adjusting levies on combustion engine cars and reforming company car taxation [4].
These proposals form part of a broader strategy to promote electric mobility and reduce emissions in the transport sector, following a significant drop in EV sales after previous subsidy programs were discontinued [4][5].
- Olaf Lies, the Lower Saxony Minister President and SPD politician, emphasizes the importance of making electric vehicles (EVs) financially beneficial for all, suggesting that cheaper electricity rates already make them more cost-effective than combustion engines for many.
- The federal government's initiatives concerning tax incentives for electric mobility are considered important by Lies, with the need for precise information and quick execution highlighted.
- Beyond affordability, Lies stresses the need to secure manufacturing in German sites, suggesting that the focus on combustion engines alone is not sustainable.
- In addition to EVs, Volkswagen offers a range of products, with Lies expressing confidence in the company's direction, given the market recovers.
- Germany has announced several proposals for tax incentives to drive the adoption of electric vehicles, including a 75% tax write-off for new electric vehicles purchased by companies, a special depreciation starting in July 2025, broader corporate tax breaks, and a socially fair EV rollout.
- By implementing these measures, Germany aims to promote electric mobility, reduce emissions in the transport sector, and boost investment in the country, contributing to its economic recovery.
