Economic stimulus package in the Corona crisis: is buying a car cheaper now?

The leaders of Union and SPD want to prevent an economic imbalance in Germany due to the coronavirus pandemic. On the night of June 3, the black-red coalition therefore agreed on an economic stimulus package that included € 130 billion. 57 measures are set out, such as financial support for families and municipalities or relief in electricity costs. The car industry also benefits from the package. A purchase premium for new cars was controversial – and is not available for every model. Prospective buyers must know that now.

Purchase premium and VAT reduction

Cars with combustion engines, i.e. low-emission petrol and diesel cars, are excluded from a purchase premium. In return, the purchase premium for electric cars rose from a net list price of up to 40,000 euros from 3,000 to 6,000 euros.

The reduction in VAT, on the other hand, hardly seems to play a role in buying a car. The grand coalition agreed that the VAT rate would be reduced from 19 to 16 percent between July 1 and December 31, 2020, and from 7 percent to 5 percent for the reduced rate. A reduction in VAT leads to lower sales prices, but is it worth it when buying a new car?

There is no purchase premium for combustion engines. A gasoline-powered Mercedes, such as an A-Class, costs around 30,000 euros gross. The lower VAT then costs less than 1,000 euros. If you want to buy a model for 100,000 euros gross, for example, you can save up to 3,000 euros.

With an electric car there is a grant of 6,000 euros. If you start from a vehicle with a net list price of just under 40,000 euros, you would have had to pay just under 45,000 euros before the package as a consumer including taxes and taking into account the old premium. Now, after the VAT cut and the premium raised, just over 40,000 euros would be due. The VAT to be paid and the purchase premium almost cancel each other out. A savings in your wallet of more than 4,000 euros.