From 2026 onward, the Netherlands will tighten the fiscal screws on electric cars, steadily dismantling the generous incentives that once made it one of Europe’s most EV-friendly markets and shifting the balance toward countries such as Belgium.
The most tangible change affects the motor vehicle tax (MRB). Fully electric passenger cars, which enjoyed a full exemption for years, will be taxed at 70 percent of the normal rate from January 2026, following a transitional quarter-rate in 2025. This fits within a clearly defined trajectory toward full taxation by 2030.
No mercy for PHEVs
Plug-in hybrids lose all remaining preferential treatment. They will be taxed at 100 percent of the regular rate, reflecting the Dutch government’s assessment that their real-world environmental benefits no longer justify fiscal support.
Extended-range electric vehicles are treated no differently: as long as a combustion engine is on board, they fall under the same tax rules as plug-in hybrids and lose all remaining fiscal advantages from 2026.
Belgium moving differentiated
Belgium is also moving away from blanket EV exemptions, but without a single national framework. From 1 January 2026, Flanders will end its full exemption from registration and annual road taxes for newly registered battery-electric and hydrogen vehicles.
New EVs will pay a fixed registration fee of €61.50 and an annual road tax based on fiscal horsepower, typically ranging from around €70 for smaller models to more than €200 for high-power vehicles. Cars first registered in Belgium before 2026 will retain their exemption for life, provided they were not imported from abroad after the exemption ends.
Brussels and Wallonia are taking a different approach, maintaining low minimum registration taxes and an essentially flat annual circulation tax of around €100. As a result, while registration costs for EVs will be broadly similar across Belgium, annual ownership costs may vary by region and vehicle power.
These differences are particularly relevant for leasing companies, which account for nearly 90 percent of Belgium’s electric car market, as even modest regional tax gaps can translate into significant cost differences when applied to large fleets.
Industry observers warn that this could encourage fleet registrations to shift toward Brussels or Wallonia, potentially reopening debates about fiscal neutrality and equal treatment.
Benefit-in-a-kind flattened
Company car taxation further highlights the contrast with the Netherlands. There, the benefit-in-kind advantage for zero-emission company cars is being flattened, with the maximum annual tax benefit capped at around €1,200.
Electric company cars remain encouraged, but the era of open-ended fiscal generosity is clearly ending. At the same time, the Dutch government is tightening the popular youngtimer scheme.
The scheme was designed to tax older, largely depreciated company cars whose original list prices no longer reflect their real economic value by basing the taxable benefit on 35 percent of the car’s current market value.
After transitional measures in 2026, the minimum age threshold will rise sharply to 25 years, effectively turning the regime into a niche arrangement for classic vehicles rather than a broadly used optimisation tool.
Belgium, by contrast, has opted for a more abrupt transition in company cars. Since 2023, only zero-emission vehicles have remained fiscally attractive for corporate fleets, while combustion-engine cars have become progressively less deductible after 2026.
EVs acquired in 2027 will see the 100% deduction reduced gradually in subsequent years, for example, to around 95% in 2027, and then declining step by step to about 67.5% by 2031.
Among stronger EV markets
In the broader European context, both Belgium and the Netherlands remain among the stronger EV markets. While battery-electric vehicles accounted for roughly 17 percent of new car registrations across the EU in 2025, uptake varied widely between member states.
The Netherlands consistently ranked among Europe’s frontrunners by market share, with electric cars making up well over 40% of new registrations at peak moments during the year.
Belgium, with a 25-30% BEV share, also performed clearly above the EU average, primarily driven by company cars and leasing fleets, placing it in the leading group of EV markets, although typically below the Netherlands in absolute market-share terms.
In absolute numbers, larger countries such as Germany and France continued to dominate, but relative to market size, both Belgium and the Netherlands outpaced most other EU markets.
France follows a more mixed approach to electromobility, combining fiscal measures with direct purchase incentives. Its long-standing bonus-malus system continues to support EV adoption through a national ecological bonus.
However, at reduced levels, most regional registration tax exemptions have now been phased out. Fully electric company cars remain exempt from the annual corporate vehicle tax, preserving a strong incentive for fleets.
In terms of market volume, France remains one of Europe’s largest EV markets. Still, in 2025, its battery-electric uptake broadly tracked the EU average of around 17%, lagging behind frontrunners, such as the Netherlands and the Nordic countries, while clearly outperforming many southern and eastern EU markets.
