As at 1 December 2022 legislation implementing the Government’s proposal to provide an FBT exemption for certain electric vehicles is still progressing through Parliament.
We covered the intended scope of the FBT exemption in our earlier article.
As we understand matters, to ensure passage of the legislation, the proposed exemption as it relates to plug-in hybrid electric vehicles will be confirmed as ending on 1 April 2025 subject to transitional relief for certain benefits provided prior to/post 1 April 2025.
For the purposes of the proposed exemption a ‘plug-in hybrid electric vehicle’ is a motor vehicle that:
a) uses an electric motor for propulsion; and
b) takes and stores energy from an external source of electricity; and
c) is fitted with an internal combustion engine for either or both of the following:
(i) the generation of electrical energy;
(ii) propulsion of the vehicle.
It should be remembered that the Government had already committed to reviewing the policy/FBT exemption after 3 years. We understand the requirement for the review will also be included in final legislation.
Once the legislation is passed we will confirm the exact scope of the FBT exemption in our TaxEd Update newsletter.
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