You’ll never guess which group of Dutch people benefited the most from EV subsidies

Subsidy for electric cars

Subsidies for electric cars were intended to accelerate the switch to cleaner driving. In practice, according to CPB, it was mainly people with a well-filled bank account who benefited. Higher incomes were far more likely to buy an EV than lower-income households. Logical, because despite subsidies, electric cars remain pricey.

Is that bad?

But is it really a bad thing that much of the government subsidies – or rather tax credits – for EVs in recent years ended up mostly with wealthier Dutch people? The purpose of the subsidies was not only to get more electric cars on the road, but also to create a used car market. Thanks to the willingness of higher incomes to invest in new EVs, that market has now emerged. This has put electric driving within reach even for those without a detached villa. For example, a used Tesla Model 3 can already be found for around 15,000 euros, while new a few years ago it cost around 60,000 euros. In the video below we tell you more about it.

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Car taxes: who pays what?

Another story is how car taxes are distributed in the Netherlands. On paper, it seems fair: low-income households spend an average of 3% of their income on car taxes, while wealthy households end up with 4%. But if you dive deeper into the figures, you see that low-income car owners in particular are hit relatively hard.

In fact, many lower income earners do not own a car at all. If you only count car owners, then on average 6% of the income of Dutch people with a smaller wallet goes on car taxes. For richer households, this remains 4%, because almost all of them have a car and feel less financially.

City or rural

Not only your income determines how much you spend on car taxes, but also where you live. In cities, households spend on average 3% of their income on car taxes, while in rural areas this rises to 5%. This too is easily explained: in rural areas, a car is often indispensable – and thus almost everyone has a car – while in cities it is easier to do without one.

Also read: Used Tesla Model 3s are bargain-basement, but what are the pitfalls?