Tax Incentives for Electric Vehicle Imports to Be Extended, Says Papoyan

The exemption from VAT for the import of electric vehicles is set to be extended until December 31, 2026, but will only apply to vehicles produced after 2024. This proposal was presented by the Minister of Economy, Gevorg Papoyan, during a meeting of the Permanent Committee on Economic Affairs of the National Assembly.

According to Papoyan, it is proposed to extend the existing VAT exemption for one more year, which currently applies to large, medium, and small buses, passenger cars, motorcycles, and mopeds with electric engines. Currently, these types of vehicles are exempt from VAT until January 1, 2026, and the exemption has been in effect since 2019.

There is also a customs duty exemption for the importation of electric vehicles from third countries. According to the decision of the Customs Union Commission, Armenia was allocated a tariff quota of 7,000 units in 2022, and for the years 2023, 2024, and 2025, 8,000 units each, for which no customs duties are charged upon import.

Papoyan noted that the exemption from VAT and customs duties has significantly increased the import of electric vehicles. In 2023, a total of 9,635 units were imported, marking a 75 percent increase compared to 2022. The forecast for 2024 predicts the importation of 11,793 units, reflecting a 22 percent increase from 2023. Comparatively, the volume of imports has increased approximately 17.6 times since 2019.

According to the Data of the State Revenue Committee, from January 1 to November 19 of this year, Armenia imported 7 electric buses, 16,381 cars, and 2,479 mopeds. It is anticipated that the import of electric vehicles will double compared to the previous year.

The proposed exemption will apply only to electric vehicles that are manufactured after December 31, 2023, specifically for production in the years 2024, 2025, and 2026. The committee has issued a positive conclusion on the bill, which will be presented at the National Assembly's plenary session.