2026 electric vehicles incentives in Europe

The transition to electric mobility in Europe continues to gain momentum, with 2025 marking another year of significant growth in battery electric vehicle (BEV) adoption. As governments, businesses, and consumers increasingly turn to electrified vehicles, the market is expanding at a sustained pace, reshaping both new and used car markets.

This expansion is not just a result of market forces; government incentives play a crucial role. From tax exemptions and purchase bonuses to charging infrastructure support, European countries are deploying a variety of measures to accelerate EV adoption. However, with incentives often time-limited and subjected to policy changes, the long-term sustainability of this growth remains a key consideration, especially for the used car market, where electric vehicles are set to become an increasingly prominent feature.

As the mobility landscape evolves, businesses and individuals alike must navigate these shifts strategically. For used car professionals, understanding these trends is essential to capitalizing on new opportunities while preparing for the challenges ahead.

EV development in Europe in the last year

In 2025, 2.58 million battery electric vehicles were sold in Europe (EU; EFTA; UK), increasing by 29.7% compared to 2024.

Sales are carried by countries like Germany (545,142 BEVs; + 43,2%), France (326,922 BEVs; +12,5%), the Netherlands (156,139 BEVs; +18,1%) or Belgium (143,849 BEVs; +12,6%). The vast majority of countries within Europe had an increase in BEV sales (25 out of 30 countries).

In addition, smaller markets like Slovenia (6419 vehicles), Slovakia (4377 vehicles) or Bulgaria (2420 vehicles) but also Poland (43311 vehicles) showed massive improvement with increases up to 161% for Poland.  

Regarding hybrid technologies, HEVs also increased but with less momentum as 2025 saw an improvement of 13,7% corresponding to 502,482 more vehicles registered than in 2024. But PHEVs in contrary increased by 33,4% representing 318 481 vehicles.

For used car professionals, this means that electric vehicles are and will continue to join the used car market in the coming years, thus it is time to start exploring this market.

Main incentives available

In order to boost sales of electrified vehicles, countries in the European Union apply their own incentives and/or tax benefits using criterias like for example: the overall price of the vehicle, CO2 emissions or give a number of years of tax reduction. Some incentives can be increased in case of scrapping of an older vehicle.

The main incentives are:

• Tax benefits like VAT deduction or exemption, exemption of ownership tax, of NOX tax, of CO2 emissions tax, of road tax…
• Incentives on the purchase of electrified vehicles (BEV, PHEV) in forms of a bonus under conditions,
• Incentives on charging station purchase and installation.

Some of these incentives are also available when purchasing a used electric vehicle in certain countries (Cyprus, Latvia, Lithuania, Slovenia, Sweden, Iceland).

Specificities in countries

In Cyprus, the grant to buy a BEV for private use is increased up to €20,000 for a new car for a disabled person or a large family.

In Estonia, the tax benefit is a basic amount of €150 + €2/kg for vehicles exceeding 2,400kg (up to €2,200).

In Portugal, individuals who buy a new BEV and scrap a fossil-fuelled vehicle older than 10 years can benefit from an incentive of €4,000.

These incentives are often limited in time, which means that they can increase or disappear from one year to another depending mainly on chosen government politics inside countries.

Conclusion

All these incentives provide help to companies and individuals looking to purchase an electrified vehicle. They help increasing overall sales and thus, future stock on the used car market.

However, experience has shown that without these incentives, electric vehicles sales decrease and thus reduce the future number of EVs available later on the used car market.

Source: Tax benefits and incentives, electric cars, 27 EU member states, ACEA, 2026