The greening of company car fleets brings visible benefits to electric car sales, CO2 emissions and budget revenues in Belgium, shows a report by The Federal Planning Bureau.
Finance Minister, Vincent Van Peteghem explicitly opted for a reform that gives consumers and producers time to adapt to the new reality: sustainable mobility must eventually become cheaper than fossil-fuelled alternatives. This is why emission-free company cars were made more fiscally attractive.
"I had a clear objective in mind with the company car reform: in times when the climate crisis demands serious measures, we had to accelerate the greening of our car fleet," said Van Peteghem. "Not only to drastically improve air quality but also to ensure that every Belgian will eventually be able to drive electric at an affordable price."
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The Federal Planning Bureau has now carried out a study on the impact of the reform in terms of the effect on sales of electric cars, the effect on CO2 emissions, and the effect on budget revenues.
Electric Car Sales
Sales in Belgium of new hybrid passenger cars (petrol or diesel + electric) have more than tripled in two years.
The report's projections show that sales of petrol plug-in hybrid vehicles and electric utility vehicles would have increased even without the reform. However, the reform provided a clear boost.
From 2026 onwards, a sharp decline in the sales of petrol plug-in hybrid vehicles is expected in favour of all-out electric vehicles.
CO2 emissions
In recent years, the share of commercial vehicles in sales has increased enormously, seeing around 700,000 company cars now on Belgian roads. Together, these cars generate emissions of about 2.8 million tonnes of CO2 per year. That is one-fifth of the emissions of the total fleet. The greening of company car fleets will cut this down significantly.
The Federal Planning Bureau shows that the reform is succeeding. Without the reform, the reduction would only be visible after 2034. With the reform, there will already be a visible drop in CO2 emissions between 2026 and 2035.
Budget revenues
The Bureau concludes that the overall impact of the reform will cause an increase in annual net tax revenues of about €1 billion from 2026 onwards. Without the reform, lost corporate tax revenue would be much higher.
"The greening of company cars is clearly the necessary kickstart towards a completely fossil-free fleet and better air quality," concluded Van Peteghem.
