- David Hort
Calls to scrap Electric car VAT grow
Both Quentin Willson and the RAC are calling for the government to scrap VAT on electric vehicles (EVs), to stimulate sales.
So far the uptake of EVs across the UK has been slow with alternative-vehicles as a whole still accounting for less than two per cent of all sales in the UK in 2011.
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Worryingly, only 500 all-electric cars have been sold since the start of the year despite the fanfare over the launch of the Nissan Leaf in March.
The government currently runs a plug-in car grant which gives £5,000 discounts off the cost electric vehicles however both Willson and the RAC argue that EVs remain too expensive for most motorists.
For example, a Nissan Leaf costs a little under £24,000, while smaller four-seat vehicles such as the Peugeot iOn cost over £450 per month to lease.
“While the Government gives £5,000 grants for EVs, they’re still far too expensive. Clawing back thousands of pounds of that grant in VAT isn’t helping," says Willson.
“We need to create demand among consumers and confidence for investors. The UK must lead the World in green car technology before the Chinese beat us to it."
The Nissan Leaf, the world’s first mass produced electric hatchback costs almost £10,000 more than internal combustion alternatives, pricing them out of the reach of the majority of motorists, according to Willson.
Scrapping VAT on EVs could cut costs by as much as £5,000 according to Willson and the RAC, bringing their costs more in line with standard cars and hopefully encouraging EV uptake.
Adrian Tink, a strategist at the RAC, commented on the proposals, saying: ‘This is about making green cars more affordable, creating jobs, cleaning our air and giving drivers’ confidence to make more fuel-efficient car-buying choices. The RAC strongly support this call for action.’
The announcement was made at London’s Motorexpo event as part of Willson’s own Drive the Future show – a green car event where visitors can ride and drive EVs, hybrids and economic cars for free.