Subsidy schemes for purchasing an electric car or for converting passenger cars to run on gas or ethanol extended until the end of December

The Government proposes that the President of the Republic adopt an act on extending the subsidy schemes for purchasing an electric car or converting a passenger car to run on gas or ethanol by one month, that is until the end of the year. The act is proposed to enter into force on 1 December 2020. The President of the Republic is expected to approve the act on Friday, 19 November 2021.

Previously, the act was applied to the purchase and conversion subsidies for which applications had been submitted by 30 November 2021. The amendment allows for households to apply for the purchase and conversion subsidies also in December 2021. Favouring vehicles with lower emissions, the purchase and conversion subsidies are helping to modernise Finland's vehicle stock, reducing greenhouse gas emissions from transport. Financing for the subsidies will be considered in connection with the fourth supplementary budget for 2021.

The temporary Purchase Subsidy Act entered into force on 1 January 2018. An appropriation of EUR 24 million has been budgeted for passenger car purchase and conversion subsidies for 2018-2021. Unused annual appropriations have been transferred for the following year. By the end of October 2021, around 70 per cent of the four-year appropriation (EUR 24 million) had been used, including both purchase and conversion subsidies. A buyer or long-term lessee of a new electric car can receive EUR 2,000 in central government purchase subsidy. The conversion subsidy is EUR 1,000 for converting a petrol or diesel car to run on gas and EUR 200 for converting a car to run on ethanol.

What's next?

The President of the Republic is to approve the bill on 9 November. The act will enter into force on 1 December 2021.

The Ministry of Transport and Communications has prepared another government proposal that would extend the current purchase and conversion subsidy schemes for low-emission vehicles. The Government submitted the proposal to Parliament on 11 November 2021. The Government proposes that the current purchase subsidies for full electric passenger cars and gas powered trucks as well as the conversion subsidy for passenger cars continue in 2022 and 2023. In addition, subsidies could be granted for purchasing an electric truck in 2022 and 2023 and for purchasing an electric or gas-powered van in 2022.

Inquiries:

Päivi Antikainen, Director of Unit, Ministry of Transport and Communications, [email protected], tel. +358 50 382 7101, [email protected]

Pinja Oksanen, Senior Officer, tel. +358 295 342 182, Ministry of Transport and Communications, [email protected]