Denmark’s new government’s decision to phases out tax breaks on electric cars will nearly triple the price of Teslas in that country.
Denmark will be canceling a pollution levy also which could make diesel vehicles more attractive, according to provisions in the 2016 budget draft. In their defence, Denmark says the measures will help create more jobs and save businesses money.
Finance Minister Claus Hjort Frederiksen told reporters on Tuesday, after the draft was unveiled in Copenhagen, “Things have to be done with reason,” .
In light of Volkswagen’s recent emissions scandal, Denmark is creating policies that will undo the previous administration’s efforts to steer consumers toward business crippling environmentally friendly vehicles. One policy will extend Denmark’s 180 percent levy to all cars, without respect to their emission levels; another defines a special tax on Nitrogen-Oxide emissions, which are emitted when burning fossil fuels and are produced more abundantly by diesel engines compared to gasoline engines.
The phasing out of tax breaks for electric cars will bring the price of a Tesla Model S from approximately 650,000 kroner ($97,665) to roughly 1.8 million kroner.
An economics professor at the Copenhagen Business School, Marcus Asplund, estimates the move will eventually lead to fewer sales of Teslas in Denmark. He also said the current fiscal regime had given Teslas, as a luxury class car, a competitive edge over other luxury model cars like the BMW 5s. Asplund and his wife are currently musing whether to purchase a Tesla before the new tax comes into effect.
The “zero-emission vehicles” levy was unvieled less than a week after Elon Musk had visited Copenhagen and just hours before Tesla’s CEO had delivered the first models of Tesla’s “long-awaited” Model X SUVs to buyers in California.
Denmark’s move marks its latest shift away from global climate change policies that the west claimed to put the Scandinavian country at the forefront of “innovative” policies designed to promote the crippling “renewable energy” mantra.
The three-month old government has already said it is abandoning ambitious CO2 emissions targets and dropping plans to become fossil-fuel free by 2050. That policy shift was revealed on Sept. 2, the same day U.S. President Barack Obama made a global appeal for urgent action to fight climate change. It’s a good bet Obama will take “some actions” to “desuade” Denmark’s latest policy changes…