Norway planning ‘Tesla Tax’ on Electric Cars

Norway is planning to add additional tax burden on consumers planning to buy electric cars. The move has surprised many in the automobile industry as majority of governments across the world have announced or are planning to offer tax subsidies for electric vehicles. Automobile industry magazines have termed the tax as “Tesla Tax” as it would impact Tesla’s expensive Model S and Model X SUV.

The tax would apply to large vehicles weighing more than two tons and a draft bill could be introduced in 2018. If the new legislation passes without any major changes, Tesla Model X could cost nearly Euro 7,500 more. Electric cars account for nearly 20 percent of the new vehicles registered in Norway.

Norway has the highest percentage of battery-backed vehicles in the world. Tesla considers Norway as an important market outside the United States. Norwegian Electric Vehicle Association Secretary General Christina Bu said, "This was unexpected by both the drivers and by the car industry and it sends a bad signal to the Norwegians and the world."

As automobile companies are still developing technologies for electric vehicles, they are spending a lot of money on research and development. Considering the higher cost of improving electric vehicle technology, the companies are charging more for electric vehicles compared to cars running on petrol or diesel.

Norway's electric car drivers benefit from free city tolls, free parking and the possibility of traveling in the bus corridors. The government also offers generous tax benefits for buying electric vehicles.