The coalition agreement of the Arizona government contained a lot of radical changes for entrepreneurs. The tax revival of plug-in hybrid cars was one of the most notable changes that was concretized in the Easter Accord.
However, the government must now retrace its steps: the relaxation will only for the self-employed moneys.
What is the context?
Counterwind
The first bill on the taxation of plug-in hybrids quickly caused quite a stir in recent months, both positive and negative. The Council of State In early June, some comments on the bill that would lead the government to a adjustment of the regime MONTHS.
On June 19, it was then reported from the European Commission that the Belgian Government could not change its hybrid taxation without doing so heavy European sanctions risk. Indeed, the planned changes were not consistent with the European climate promises that Belgium made earlier.
Drastic adjustment
To avoid European sanctions paste the Arizona government's reform plans drastically to. The fiscal comeback of plug-in hybrids will apply only to the self-employed (individuals with corporate numbers, subject to personal income tax). Corporations fall out of scope.
What new tax rules apply to the self-employed?
The tax deductibility of car expenses is still calculated using the formula based on the CO₂ emissions from the car:
120% - (0.5% x number of grams of CO₂/km)
The CO₂ coefficient is no longer part of the formula for determining the deductibility of a car.
Due to the low CO₂ emissions of plug-in hybrids, the costs related to these cars until now were mostly up to 100% deductible. However, this only applied to hybrid cars that had a battery with an energy capacity of at least 0.5 kWh per 100 kilograms of vehicle weight, and did not emit more than 50 grams of CO₂ per kilometer.
False hybrids and the impact of stricter standards
Wagons that did not comply were also called 'false hybrids' and were tax-equivalent to fuel-only cars, which meant lower deductibles.
As a result of the amended "EURO-6e-bis" emissions standard, a lot of cars would exceed the 50-gram CO₂ limit in the future, and qualify as a "false hybrid. However, the federal government is now raising the CO₂ limit from 50 grams to 75 grams of CO₂ per kilometer For cars covered by the new EURO-6e-bis standard.
Plug-in hybrids remain attractive to the self-employed
In addition, the finishing Of the tax deductibility of "real" plug-in hybrid cars deferred. In addition, it deduction rate 'locked in' again in the year in which the car is ordered, which would consequently eliminate a "phase-out" scenario for the self-employed throughout the car's useful life.
Under these new self-employed rules, plug-in-hybrid cars, depending on their CO₂ emissions, can again enjoy a deduction regime similar to that of a all-electric vehicle.
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Deduction regime for plug-in hybrid cars (Arizona government) |
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| Car Costs | Fuel (gasoline/diesel) | Electricity | |
|
Order from 2025 tem. 2026 |
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| Emissions < 50 grams | 2025: 75% | 50% through 2027 | 100% |
| 2026: max. 100%* | |||
| Emissions 51 - 75 grams | 75% | ||
| Emissions > 75 grams |
'False hybrid' |
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|
Order in 2027 |
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| Emissions < 50 grams | Maximum 95%* | 50% through 2027 | 95% |
| Emissions 51 - 75 grams | 75% | ||
|
Order in 2028 |
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| Emissions < 50 grams | 90% | 0% | 90% |
| Emissions 51 - 75 grams | 65% | ||
|
Order in 2029 |
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| Emissions < 50 grams | 82.50% | 0% | 82.5% |
| Emissions 51 - 75 grams | 57.50% | ||
| Order from 2030 | |||
| Emissions < 50 grams | 0% | 0% | 0% |
| Emissions 51 - 75 grams | |||
*The exact deduction percentage should be determined based on the existing formula: 120% - (0.5 x number of grams of CO₂/km). The fuel coefficient will no longer be included in the formula.
The above deduction percentages remain applicable in each case for the entire useful life of the car (date of order to expiration of lease contract/sale).
What about partnerships?
Government also draws 'false hybrid emissions limit' for corporations up from 50 grams to 75 grams of CO₂ per kilometer For cars covered by the new EURO-6e-bis standard.
Otherwise, however, the regulations introduced by the Vivaldi government remain in place.
| Deduction regime for plug-in hybrid cars (Vivaldi government) | ||||
| Order by 30/06/2023 | Order from 01/07/2023 | |||
| Car Costs
Fixed deduction rate throughout the useful life |
Fuel costs | Car Costs
Decreasing maximum deductibility through the useful life. |
Fuel costs | |
| Deductible up to a maximum of 100% during entire useful life | Order no later than 31/12/2022:
maximum 100% Order from 01/07/2023: maximum 50% throughout the service life |
Aj. 2025 | Maximum* 100% | Gasoline/diesel cost: 50%
Electricity : 100% |
| Aj. 2026 | Maximum* 75% | Gasoline/diesel cost: 50%
Electricity : 100% |
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| Aj. 2027 | Maximum* 50% | Gasoline/diesel cost: 50%
Electricity : 100% |
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| Aj. 2028 | Maximum* 25% | Gasoline/diesel cost: 25%
Electricity : 100% |
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| Aj. 2029 | Maximum* 0% | Gasoline/diesel cost: 0%
Electricity : 100% |
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*The exact deduction percentage should be determined based on the existing formula: 120% - (0.5 x number of grams of CO₂/km).
Changed emissions standard causes substantial carbon increase
What standard?
On Jan. 1, 2025, the New European emissions standard 'EURO-6e-bis' for fuel cars introduced. Under this new standard, CO₂ tests for new cars will be significantly tougher be, with a higher measured CO₂ emissions as a result.
In practice, all new car models to be homologated from January 1, 2025 will already be covered by this new standard. From January 1, 2026, the CO₂ emissions of the existing car models recalculated should be based on this new standard.
What cars?
It goes only about new cars with a production date as of Jan. 1, 2025 (new models), or Jan. 1, 2026 (existing models). Cars produced before these dates will not be affected. For the majority of manufacturers, the EURO-6e-bis standard will apply to cars starting in model year 2026.
When ordering a new car, it is appropriate to check with the manufacturer to see which standard the car will fall under.
What impact?
The change in the method by which the emissions of plug-in hybrids are measured is expected to result in a sharp increase in the official CO₂ emissions of these cars. In general, the a doubling of emissions is expected for most plug-in hybrids.
What does this mean for you as an entrepreneur?
Are you self-employed without a corporation?
If so, this modified regulation offers you once again interesting tax advantages when purchasing a plug-in hybrid. Thanks to the increased emissions limit and the maintenance of a fixed deduction percentage, as a natural person you can continue to enjoy a favorable deduction regime very similar to that of electric cars.
Do you have a corporation?
Then it remains to pay attention: the stricter phase-out schedule continues to apply to you. Let us guide you in the choice of your next company car. Together we will look at what is fiscally most interesting today (and tomorrow). Discuss it with your Titeca pro expert.
