All changing car taxes in 2023

The tax system is a useful tool for the government to influence the choices made by motorists. For example, the government is firmly committed to electric driving to make car mobility more sustainable by introducing tax benefits for electric cars. Now that EVs are slowly becoming commonplace, those benefits are gradually being phased out. After all, even if the majority of the cars in the Netherlands are electric, sufficient tax must continue to come in. Developments are going fast, which means that something changes in taxes almost every year. In this article you will find all the changes for 2023.

1: more addition for EVs of more than €30,000

Do you have a company car and do you also drive it privately? Then you pay addition. For ‘regular’ cars (that emit CO2) you add 22 percent of the catalog value of the car to your taxable income. A reduced percentage applies to electric cars, but this is slowly being phased out. The addition percentage for EVs will be the same in 2023 as in 2022, but the value over which you pay that reduced rate will change. From 1 January, the reduced addition percentage only applies to the first €30,000 of the catalog value of your electric car. You pay the full 22 percent on the value above that €30,000. This year, you pay less addition on the first €35,000, but that will be phased out. Note: if you drive on hydrogen, then ’16 percent’ does apply over the entire catalog value. There will be no change to the addition for non-BEVs.

2: more motor vehicle tax (mrb)

The monthly tax you have to pay as a motorist (also known as road tax) will also increase. The amount to be paid goes partly to the state and partly to the provinces. For the part that goes to the state, the rates increase by 4.75 percent. The height of the part for the provinces is determined by the provinces themselves. Six of the twelve provinces have opted to implement an increase from 1 January 2023. These are Groningen, Gelderland, Utrecht, South Holland, North Brabant and Limburg. The increase is greatest in South Holland. The increases do not apply to owners of an electric car, because they do not have to pay an MRB next year either. For cars with a plug-in hybrid powertrain, you pay half the regular rate – also in 2023. Only after 2024 will the mrb benefits for PHEVs and EVs change.

3: more bpm

Not only the tax for using the roads is increasing, but also the tax you pay when purchasing a new car: the bpm. This is related to the CO2 emissions per kilometer of the car you buy. For EVs, you do not pay bpm when purchasing. You do pay bpm for all other cars. The amount depends on the ’emissions bracket’ in which your car falls. The limits of those brackets have been lowered before 2023, so you are more likely to belong to a higher bracket. At the same time, the rates for each tranche will increase by 2.35 percent (excluding an inflation adjustment of 6.3 percent) as of 1 January. Cars with emissions are therefore more expensive to purchase.

Not only the amount per gram of CO2 emissions will increase, the ‘fixed base’ (the fixed part of the bpm per emission bracket) will also increase. For example, in 2022 it was still €376 for cars with emissions of up to 82 grams per kilometer, but in 2023 it will be €400. In addition, in 2022, the fixed base did not have to be paid for PHEVs, but this must be done from 1 January. In time, there will also be a fixed base for EVs. For cars with higher CO2 emissions you pay a higher fixed base (column III in the image below).

In this image you will find the brackets and rates from 1 January 2023 (source: Ministry of Finance):

4: more fuel excise duties

Due to the rapidly rising fuel prices earlier this year, the state temporarily reduced excise duties on petrol, diesel and LPG by 21 percent. This reduction will be scaled back as of July 1, 2023, so that prices will in principle increase again: see the table below. Incidentally, excise duties will not be back to the level before the excise duty reduction during the second half of 2023, because oil prices are still expected to be high then.

5: more tax-free travel allowance

The fact that both bpm, mrb, excise duties and addition are rising is of course painful for the wallet. Fortunately, there is also a positive note to conclude this overview: from 1 January, the travel allowance will go from 19 to 21 cents (tax-free) per kilometer. It will not compensate for the rising costs of driving a car, but it will make a difference. In 2024, the amount will also increase; then the tax-free travel allowance will increase from 21 to 22 cents.