The tax benefits for plug-in hybrids are disappearing and this has major consequences for car buyers.
From 2025, cars with a battery pack and a combustion engine will also have to pay the full rate of road tax. Until now, these vehicles were fiscally more attractive, but with the new regulations that will change drastically. The question now is: will driving on petrol or diesel become more attractive again?
The new tax rules seem to price the plug-in hybrid out of the market. The only advantage that remains is the lower purchase price due to the bpm discount and the possibility to make cheap kilometers by charging at home. But as soon as someone drives few electric kilometers or has no possibility to charge at home, the advantage quickly disappears.
Those who drive few kilometers will be better off with a petrol variant. The higher road tax for a plug-in hybrid makes it financially less attractive for drivers who can only drive electrically sporadically. In addition, the extra weight of a PHEV also has disadvantages for the driving characteristics and fuel consumption when the battery is empty.
For diesel drivers it is a different story. Despite the high road tax, diesel remains attractive for people who drive a lot. Due to the lower consumption and the relatively low price per liter of diesel, the additional cost of the road tax can be compensated. Especially on the highway, a diesel engine often offers lower fuel consumption than a comparable petrol engine.
The rules will become even stricter in the future. From 2026, the tax advantage of plug-in hybrids will be further reduced and the road tax for these cars will even be higher than that of a petrol car. This is because PHEVs fall into a higher weight class due to their heavy battery packs. As a result, the tax advantage of hybrids will disappear completely and many buyers will wonder whether a petrol or diesel car is not the better choice.
To map this out, a researcher from De Telegraaf uses the BMW 3-series as an example. This model is available as a petrol, diesel and plug-in hybrid (PHEV), which makes it a good comparison. On paper, the PHEV seems attractive because of its lower bpm, but in practice it can turn out differently.
The disappearance of the tax break means that the popularity of plug-in hybrids will come under pressure. Many motorists choose a PHEV because of the lower costs, but if this advantage disappears, it will become less and less attractive to go for a hybrid. This could result in an increase in sales of petrol cars and a comeback of diesels for frequent drivers.
the calculation
The bpm (passenger car and motorcycle tax) plays an important role in the purchase price of a car. This tax is based on CO₂ emissions, which means that electric and hybrid cars have enjoyed a tax advantage up until now. This will still be the case in 2025. For example, a BMW 330i XDrive sedan currently costs at least €70.885,10, while the 330e xDrive sedan – the plug-in hybrid – costs €59.743,10. The price difference of over €11.000 makes the PHEV a more attractive choice at first glance.
However, things are different when road tax is taken into account. This tax is calculated based on the weight of the car. Because plug-in hybrids have a battery pack, they are heavier and therefore pay more tax. In North Holland, this means a road tax of €330 per quarter for the BMW 1.860e with a weight of 347 kg. The petrol version of the same car, the 330i, weighs 1.570 kg and costs €269 in road tax per quarter. The difference is therefore €312 per year in favour of the petrol version.
For diesel drivers, the bill is even higher. The BMW 330d xDrive with a six-cylinder diesel engine weighs 1.735 kg and costs €572 per quarter in road tax. A lighter diesel variant, the 320d xDrive with a four-cylinder, comes to €530 per quarter. Despite the higher road tax, diesels can still be attractive to frequent drivers due to their economy and lower fuel price.
