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Tax exemptions for EVs extended to 2025

On 29 December 2021, Taiwan’s Legislative Yuan passed an amendment to the Vehicle License Tax Act to extend the licence tax exemption for electric vehicles (EVs) until 2025.

This follows the cabinet’s approval on 15 November 2021 of an extension until the end of 2025 of the commodity tax exemption period for EVs. Since 28 January 2017, buyers of all-electric automobiles and motorcycles have been exempted from paying the commodity tax. However, for passenger cars, the full tax exemption is limited to NT$1.4 million of taxable value, and the value exceeding this is subject to a 50% commodity tax reduction.

The extension of these tax exemptions represents a breakthrough for the ECCT’s Mobility committee, which has advocated for extending the existing tax incentives to at least 2030 with a sunset clause linked to Taiwan's EV penetration rate.