Tax incentives to boost the growth of corporate electric vehicle fleets

This was followed by a clarifying statement from the Italian Revenue Agency, which stipulated that the new tax rates apply to new or previously registered vehicles made available to employees from 1 January 2025.

The legislative measures also covered the procedures for refuelling and/or recharging, though this has resulted in an overlap of regulations. Whilst, for traditional vehicles, fuel costs paid for by the employer do not constitute taxable income for the employee, for electric vehicles, the costs incurred and reimbursed for recharging (whether at home or at work), in private contexts, are treated as taxable income; in the case of vehicles used for both business and private purposes, this results in double taxation on the electricity used, which is already included in the calculation of the fringe benefit.

To address this issue, two proposed amendments to the Tax Decree (Bill No. 1852), currently under discussion in the Finance Committee of the Senate of the Republic, have also been tabled, with Senators Gelmetti (FdI) and Damiani (FI), which aim to amend the legislation by adding a provision to Article 51 of the TUIR that excludes, from income from employment, the costs incurred for the purchase of electricity used to charge company vehicles. This would make the tax treatment of electric cars fairer, thereby encouraging the adoption of green fleets.

On the subject of corporate taxation, the Motus-E association – which has produced a guide for fleet managers specifically on the electrification of company fleets – argues that action is also needed at employer level, by introducing differentiated deduction rates based on vehicle emissions (CO₂/km). Such a mechanism would, in fact, provide a tangible incentive for companies that choose zero-emission vehicles, transforming tax policy into an active tool for decarbonising the corporate vehicle fleet. This would also help expand the second-hand electric vehicle market, benefiting all citizens through the increased availability of ex-company electric cars.

Currently, the legislation provides for different levels of deductibility depending on the vehicle’s use. For vehicles used exclusively for business or public purposes, 100 per cent deductibility is recognised for IRPEF/IRES purposes, with no spending limits. When the vehicle is allocated to an employee for mixed use, the deduction rate falls to 70 per cent, whilst in other cases it stands at 20 per cent, with a maximum limit of €18,075.99 for purchase or leasing and €3,615.20 per annum for hire.

For commercial agents and representatives, the threshold rises to 80 per cent of expenses, with higher ceilings: €25,822.84 for purchases and €5,164.57 for leasing or hire. Finally, for all other uses, the deduction is capped at 20 per cent, with the same limits as those applicable to mixed use.

As regards VAT, the legislation allows for a full deduction for vehicles used exclusively for business purposes or by commercial agents, whilst in other cases of use the deduction is reduced to 40 per cent.

It is precisely within this context that Motus-E’s proposal fits: differentiating the rates of tax deductibility according to a vehicle’s emissions profile would not only simplify and make fairer a system based on a regulatory framework dating back to the 1990s, but above all to steer businesses’ purchasing decisions towards zero-emission solutions, with positive repercussions for the entire sustainable mobility ecosystem.