Fixed-term act on the scrapping incentive for passenger vehicles circulated for comments

The Government's proposal for a fixed-term act on the scrapping incentive for passenger vehicles is being circulated for comments. According to the proposal, the scrapping incentive could be granted to a private individual to replace an old vehicle to be scrapped with a new vehicle, an electric bicycle or a public transport ticket. EUR 8 million will be reserved for the scrapping incentive.

Support for the purchase of a lower-emission vehicle, electric bicycle or public transport ticket

It is proposed that the condition for receiving the incentive is that a new passenger vehicle, a new electric bicycle or a public transport ticket be purchased to replace an old, scrapped vehicle. The vehicle to be scrapped must be more than 10 years old, and a certificate of scrapping must be issued. The new passenger vehicle to be purchased must be a gas-fueled vehicle, an all-electric vehicle, a rechargeable hybrid vehicle with maximum CO2 emissions of 95 grams per kilometre or another vehicle with maximum CO2 emissions of 95 grams per kilometre. In other words, the emission limit applies to rechargeable hybrid vehicles and other vehicles than gas-fueled and all-electric vehicles.* Alternatively, the scrapping incentive can also be used to purchase a new electric bicycle or a public transport ticket.

The draft proposes that the state should pay a scrapping incentive of EUR 1,000-2,000, depending on the power of the car to be purchased, and a maximum of EUR 1,000 for the purchase of a public transport ticket or an electric bicycle. The scrapping incentive could only be obtained once during the support period and would only be granted to private individuals.

Scrapping incentive reduces emissions and renews car fleet

"The scrapping incentive is the first measure on the road map to fossil-free transport. The incentive contributes to emission reduction targets as it supports the purchase of low-emission vehicles or the switch to e-bikes or public transport," says Timo Harakka, Minister of Transport and Communications.

The granting of a scrapping incentive for the purchase of an electric bicycle or public transport ticket will also promote cycling and the use of public transport. According to research, electric cycling extends average cycling distances and replaces car journeys.

The aim of the proposal is to speed up the sales of new vehicles and increase the share of alternative propulsion in transport. In September, electric vehicles and rechargeable hybrid vehicles already accounted for a quarter of first registrations.

"The introduction of the scrapping incentive aims to revitalise the economy due to the consequences of the COVID-19 epidemic. Sales of new cars in particular have slowed down this year," says Minister Harakka.

What are the next steps?

The circulation for comments will end on 19 October 2020. Statements can be made by all organisations and citizens online via www.lausuntopalvelu.fi or by email to [email protected]. After the round of statements, public officials will continue with the preparatory legislative work.

The legislation should enter into force at the end of 2020 and be in force until the end of 2021. The scrapping incentive should be applied for by 31 August 2021. The Finnish Transport and Communications Agency Traficom would be responsible for the funding decisions.

Inquiries

Päivi Antikainen, Director of Unit, tel. +358 50 382 7101

Eleonoora Eilittä, Ministerial Adviser, tel. +358 50 309 9189

*Correction made on 16 October at 11.30. The following two sentences have been removed: "The new passenger vehicle to be purchased must be a gas-fueled vehicle, an all-electric vehicle, a rechargeable hybrid or another vehicle with maximum CO2 emissions of 95 grams per kilometre. The emission limit also applies to rechargeable hybrid vehicles." They have been replaced by the following two sentences: "The new passenger vehicle to be purchased must be a gas-fueled vehicle, an all-electric vehicle, a rechargeable hybrid vehicle with maximum CO2 emissions of 95 grams per kilometre or another vehicle with maximum CO2 emissions of 95 grams per kilometre. In other words, the emission limit applies to rechargeable hybrid vehicles and other vehicles than gas-fueled and all-electric vehicles."