26.08.2022

Subsidies for electric cars – My electric car Programme

REASONS FOR THE POPULARITY OF ELECTRIC CARS

In the era of rising car maintenance costs, the looming climate crisis and the announced EU climate package, more and more Poles are deciding to buy an electric car. Another factor that has a positive influence on this decision is the ‘My Electric Car’ programme, whose objective is to avoid air pollution emissions by subsidising projects aimed at reducing the consumption of emission fuels in transport – support for the purchase/lease of zero-emission vehicles.

ASSUMPTIONS OF THE MY ELECTRIC CAR PROGRAMME

The new ‘My Electric Car’ programme, which enables obtaining subsidies for the purchase of electric vehicles, was launched on 12 July 2021. The programme provides for subsidising projects consisting in the purchase of a new vehicle of the M1, N1 and L1e-L7e category powered only by electricity accumulated by connection to an external power source, or electricity generated from hydrogen in fuel cells installed in the vehicle, or propelled only by an engine whose operation cycle does not lead to the emission of greenhouse gases or other substances covered by the greenhouse gas emissions management system referred to in the act of 17 July 2009 on the greenhouse gas emissions and other substances management system.  A new zero-emission vehicle should be understood as a vehicle of the M1, N1 and L1e-L7e category which is brand new and has not been registered before the purchase, or a vehicle purchased and registered by a car dealer, importer or leasing company with the mileage of no more than 50 km.

The programme budget is PLN 700 million. The programme is scheduled to be implemented from 2021 to 2026, and applications will be accepted until 2025 or until the funds are exhausted. The disbursement period will end on 20 June 2026.

WHO CAN BENEFIT FROM THE SUBSIDY AND UNDER WHAT CONDITIONS

First of all, one should answer the question of who will be able to benefit from the programme. The list of entities that can apply for the subsidy has been divided into two categories:

  • Category one – natural persons
  • Category two – entities other than natural persons, including entrepreneurs:
  • Public finance sector entities, within the meaning of the act of 27 August 2009 on public finance (consolidated text: Journal of Laws 2022, item 1634);
  • Research institutes, within the meaning of the act of 30 April 2010 on research institutes (consolidated text: Journal of Laws 2022, item 498);
  • Entrepreneurs, within the meaning of the act of 6 March 2018 – Enterprise Law (consolidated text: Journal of Laws 2022, item 974);
  • Associations, within the meaning of the act of 7 April 1989 – Associations Law (consolidated text: Journal of Laws 2020, item 2261);
  • Foundations, within the meaning of the act of 6 April 1984 on foundations (consolidated text: Journal of Laws 2020, item 2167);
  • Cooperatives, within the meaning of the act of 16 September 1982 – Cooperative Law (consolidated text: Journal of Laws 2021, item 648);
  • Individual farmers, within the meaning of the act of 11 April 2003 on the structuring of the agricultural system (consolidated text: Journal of Laws 2022, item 461);
  • Churches and other religious associations and their legal persons; Religious organisations whose legal situation is regulated by the laws on the relationship between the state and churches and other religious associations, operating within such churches and associations.

As far as the substantive conditions for the subsidising are concerned, these are as follows:

  1. the subsidy will not be provided for projects the costs of which have been co-financed from national or foreign public funds, in particular from the European Union budget;
  1. the purchased/leased zero-emission vehicle must be new;
  1. the purchased/leased zero-emission vehicle must be labelled during the programme durability;
  1. the durability period is 2 years from the date of the project completion (purchase of the vehicle), while in the case of lease it should be understood as the date of delivering the new vehicle to the beneficiary (Lessee) for use or use and deriving benefits, on the basis of a vehicle delivery report;
  1. the co-financed zero-emission vehicle must be registered in the territory of the Republic of Poland for at least 2 years following the project completion date;
  1. the zero-emission vehicle must be registered to the vehicle owner, who is the beneficiary of the subsidy under this programme (in the case of lease, the vehicle may be registered to the beneficiary or the leasing company with which the beneficiary is bound by the lease contract);
  1. the co-financed zero-emission vehicle must be insured against damage, destruction and loss due to collisions, accidents, third party damage and theft, including third party liability insurance and own-damage motor insurance, at least for the durability period;
  1. in the event of a failure to comply with the obligations referred to in items 5 to 7, the subsidy, together with the due interest, is to be returned in accordance with the conditions laid down in the subsidy agreement; the agreement may, in particular, specify the proportion of the repayment and the cases in which the repayment may be waived;
  2. the subsidy payment may be conditional on the establishment of a repayment security;
  1. the subsidy may be awarded for an undertaking completed before the application submission date, subject to item 13);
  1. the subsidy will be paid only in the form of a refund after the purchase of the vehicle, or in the form of a grant for the charges laid down in the lease contracts (initial charge and transfer fee), after signing the vehicle delivery report;
  1. if the subsidy relates to a zero-emission vehicle category M2 or M3 and constitutes public aid, the provisions of the Regulation of the Minister of the Environment of 21 December 2015 on detailed conditions for granting horizontal public aid for environmental protection purposes (Journal of Laws item 2250) concerning the aid for investments enabling the reduction of pollution emissions when EU environmental protection standards have not been established will apply;
  1. a project consisting in the purchase/lease of an M2 or M3 category vehicle cannot be commenced before the subsidy application submission date. The project commencement should be understood as the conclusion of the contract for the vehicle purchase/lease;
  1. if the applicant is a natural person who does not run a business, he/she may receive one subsidy for one zero-emission vehicle;
  1. the subsidy for the initial payment and the transfer fee indicated in the zero-emission vehicle lease contract may be granted only if the object of the lease has not previously been subsidised under this programme;

VALUE OF THE SUBSIDY

The value of the subsidy depends on the category of the vehicle purchased:

Category M1:

  • subsidy of up to PLN 18,750

OR

  • subsidy of up to PLN 27,000, if the average annual mileage declared exceeds 15,000 km
  • In addition, when purchasing an M1 category vehicle, please note that the purchase cost of the zero-emission vehicle may not exceed PLN 225,000

Category N1:

  • subsidy of up to 20% of the eligible costs, no more than PLN 50,000

OR

  • subsidy of up to 30% of the eligible costs, no more than PLN 70,000, if the average annual mileage declared exceeds 20,000 km

Category L1e – L7e:

  • subsidy of up to 30% of the eligible costs, no more than PLN 4,000

The amounts indicated above are net amounts for entities entitled to deduct 100% of VAT. This means that if the car will be used for private and business purposes, when 50% of VAT can be deducted, then the prices indicated include the tax to be deducted. For an entrepreneur not entitled to deduct the VAT tax, the quoted prices are gross prices.

It should be mentioned that if the applicant is applying for the co-financing of more than one vehicle, the purchase or lease of each vehicle is treated as a separate project.

BENEFITS FOR ELECTRIC CAR DRIVERS

In order to encourage the Poles to purchase and use electric cars, the government provides support for their drivers through a number of benefits:

  • Exemptions from public road tolls,
  • Additional parking stands,
  • Exemption from excise duty,
  • Clean transport zone,
  • Higher depreciation limits,
  • Right to drive on bus lanes.

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