Ministry of National Economy and Finance Weighs Revision of Hybrid Vehicle Tax Incentives

The Ministry of National Economy and Finance (Υπουργείο Εθνικής Οικονομίας και Οικονομικών) is considering corrective measures, or even the full withdrawal of new provisions concerning tax incentives for hybrid vehicles. This reassessment follows strong reactions recorded during the public consultation of the relevant bill, following previous analyses regarding surprises in state regulatory interventions.

Changes to Registration Tax

At the center of the criticism is the proposed regulation to impose a uniform 50% exemption from the registration tax (Τέλος Ταξινόμησης) for all hybrid vehicles, regardless of carbon dioxide (CO₂) emissions. Under the current regime, hybrid vehicles emitting up to 50 grams of CO₂ per kilometer benefit from a 75% exemption, while the rate for others stands at 50%.

The abolition of this differentiation is expected to lead to increases in the retail prices of plug-in hybrid electric vehicles (PHEVs). A characteristic example is a plug-in hybrid which currently, with the 75% discount, incurs a registration tax of €5,700; with the reduction of the discount to 50%, the tax will rise to €6,650. This translates to an increase in the car's final sale price of approximately €1,000.

Transitional Period

To avoid disrupting commercial agreements and orders already placed under the previous regime, the bill provides for a transitional protection period. Specifically, for hybrid cars with emissions up to 75 grams of CO₂ per kilometer imported into the country from November 1, 2025, until May 31, 2026, the 75% exemption will be maintained.

Curbing Incentives for Corporate Vehicles

Significant changes are also being promoted in the tax framework for corporate vehicles, drastically limiting the advantages that previously applied to low-emission hybrids. As noted in the analysis of the strategic relationship between tax administration and sustainable development in Greece, tax exemptions regarding the exclusion from taxable income for benefits-in-kind (BIK, non-cash perks provided to employees), reimbursements linked to usage, and charging costs, will cease to apply for hybrid cars and will be maintained exclusively for zero-emission vehicles.

Additionally, the special regime for granting hybrid corporate cars to employees, partners, and shareholders is being abolished. Moving forward, tax incentives will apply only to battery electric vehicles (BEVs), as the government finalizes the design of a new tax framework, which also sets a pre-tax retail price ceiling of €40,000 for maintaining relevant exemptions.

Market Reactions

Importing companies and representatives of the automotive sector warn that the shrinking of these incentives will particularly hit the market. They emphasize that the plug-in hybrid category grew in recent years precisely because of these tax reliefs. Final decisions from the Ministry of Finance, which will determine the definitive framework for hybrid vehicles, are expected after the conclusion of the public consultation.