The Financial Secretary proposes to suspend the First Registration Tax (FRT) concession for electric private cars after its expiration at the end of March this year. According to sources, this proposal is not an outright cancellation; the authorities have been adjusting the concession level since 2017 and plan to phase out the concession rate by approximately 40% in 2024. With market conditions maturing, the government believes that the FRT concession under the ‘one-for-one’ replacement scheme should be suspended.
Sources added that in the market, car owners have a wide range of models and price points to choose from, covering electric private cars with varying performance levels. While the suspension of this measure may impact car owners’ desire to switch to electric vehicles in the short term, adopting electric vehicles is seen as an inevitable trend. Currently, seven out of every ten newly registered private cars are electric vehicles, and there is confidence that this will not affect the progress towards the policy goal of encouraging EV adoption.
