While EVs might be great news for the environment, their rapid success in Norway is now forcing some serious fiscal consternation. (2021)
of new car sales were electric as of October, and the US, where that number is just 2.6 percent.
The road to this point has been long—and offers lessons to other countries racing to ditch gas-guzzling combustion engines. In Norway, the most progressive electric vehicle policies in the world started with a pop group, an environmentalist, and a small red Fiat Panda. It was 1988 when activist Frederic Hauge, along with fellow green campaigners from the band A-ha, traveled to the Swiss city of Bern, where they found the red Fiat.
In an attempt to claw back lost income, officials are stripping electric cars of special status, sparking fierce debate and concern that the country could jeopardize its goal of selling no new cars with combustion engines by 2025. The toll charge exemption was first to go in 2017. Now, Norway’s center-left coalition government is considering removing a much broader list of incentives as part of ongoing budget negotiations.
Norway’s environmentalists say they are not against the idea of taxing EVs so long as taxes for fossil fuel cars stay high, too. But there is concern about the wrong taxes coming too soon. “This could cause major setbacks,” says Hauge. “Reintroducing VAT for cars above 600,000 krone seems like a strange thing to do because those are the cars that are useful” in rural areas where people spend more time on the road—and need to drive EVs over long distances, he says.
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