Switzerland levies an automobile tax on the import of vehicles. This tax amounts to 4% of the import value of the vehicle imported into Switzerland. Since the introduction of the automobile tax in 1997 electric vehicles have been exempt from this tax in an effort to make these electric vehicles an attractive option. On April 5, 2023 the Swiss Federal Council opened a consultation on amending the Automobile Tax Ordinance. The consultation period runs until July 12, 2023.

From 2024, electric cars will also be subject to the automobile tax. In this way, the Federal Council wants to counteract the decline in revenue from the automobile tax and secure the deposits in favor of the national roads and agglomeration transport fund. The taxation of electric cars is part of the concept adjustment to the state budget, to which the Federal Council decided during its meeting on January 25, 2023.

Based on the Automobile Tax Act, the Swiss federal government levies a 4% tax on automobiles used for the transport of people or goods. This tax is levied over the import price and not over the retail price of the vehicles. As a result, the final sales price of a vehicle will increase by less than 4 percent, even though the tax is fully passed on to consumers. According to the Federal Constitution, the tax revenue is earmarked and allocated to the National Roads and Agglomeration Transport Fund (the Nationalstrassen- und Agglomerationsverkehrsfonds (NAF)). Under the Motor Vehicle Tax Ordinance Electric, cars have been exempt from this tax since the introduction of the automobile tax in 1997. At the time, The Federal Council had decided on this exemption in order to promote the development of electric mobility.

The growth of electromobility has revealed a new reality: From 2018 to 2022, the number of tax-exempt electric cars that were annually imported increased almost six-fold from around 8,000 to over 45,000. Their share of the total car imports in 2022 was almost 20 percent. This increase leads to a noticeable decrease in revenue from automobile tax.

With the planned amendment to the Automobile Tax Ordinance, the Federal Council wants to counteract the tax shortfalls that occur at the expense of the NAF. The aim is to abolish the exemption for electric cars from automobile tax as of January 1, 2024 and to subject electric cars to the normal tax rate of 4% in the future. The tax exemption as a support instrument is no longer necessary in view of the sharp rise in the share of electric cars in all car imports and the convergence of prices from the point of view of the Federal Council.

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