Electric Vehicle Tax Ruse in South Africa Exposed by MyBroadband: South African Consumers Face Misleading Taxes on EVs

September 17, 2025

Johannesburg, South Africa – Contrary to widespread perceptions, South Africa does not levy unique, additional import taxes specifically targeting Electric Vehicles (EVs). The narrative suggesting punitive tariffs on EVs has been largely inaccurate,according to industry insights obtained through recent discussions with key stakeholders in the South African e-mobility sector.

The Import Duty Landscape Explained

The misconception stems from a discrepancy in import duties applied to EVs originating from Europe and the United Kingdom compared to those from othre regions. Currently, petrol and diesel vehicles imported from europe and the UK benefit from a reduced duty of 18% due to existing reciprocal trade agreements.

Though, Electric Vehicles imported from these same regions face a higher duty of 25%, equivalent to the duty applied to almost all other vehicle imports globally. This 25% duty applies uniformly to EVs sourced from the rest of the world, including major EV manufacturing hub China.

The clean Trade and Investment Partnership agreement,launched in March 2025,is under review,and may address these tariffs. However, any changes are unlikely to shift the advantage currently held by Chinese EV manufacturers, who benefit from lower production costs driven by factors such as cheap labor, economies of scale, and robust supply chains.

A Blow to Local Manufacturing?

A reduction in import duties on EVs, particularly those from China, could significantly harm South Africa’s struggling local automotive manufacturing industry. Executives within the e-mobility sector emphasize the importance of protecting local jobs and production capacity. Carmakers investing in South African operations will begin receiving a 150% tax rebate on alternative propulsion manufacturing equipment starting in April 2026.

Did You Know? According to the Automotive Business council, the South African automotive industry contributes approximately 7% to the country’s Gross Domestic Product.

The True Cost of EVs: Price Parity on the Horizon

Industry experts agree the primary factor driving the higher cost of EVs isn’t solely import duties, but rather the expense of battery technology. however,this is rapidly changing. Analysts predict EV price parity with conventional internal combustion engine vehicles by 2026 or 2027, fueled by a substantial decline in the price of lithium carbonate, a key battery component.

The table below summarizes the current import duty structure:

import Source	Petrol and Diesel	Electric
Europe and the UK	18%	25%
SADC Region	Reduced or Duty-Free	Reduced or Duty-Free
Rest of the World	25%	25%

President Cyril Ramaphosa has indicated the government’s intention to introduce consumer incentives,potentially in the form of subsidies or tax rebates,to encourage EV adoption. However, careful consideration is needed to avoid unintended consequences for the local manufacturing base.

Pro Tip: Consider total cost of ownership when evaluating an EV-lower running costs and reduced maintenance may offset initial higher purchase prices.

A senior executive from a prominent e-mobility company stated that the focus should be on promoting EVs based on their inherent benefits-improved driving experience and lower running costs-rather than relying on preferential tax treatment.

Ultimately, the appeal of EVs extends beyond environmental considerations, with factors like performance and cost-effectiveness playing a crucial role in consumer choices.

Looking Ahead: The Future of EVs in South Africa

The South African EV market is poised for growth, driven by falling battery costs, increasing model availability, and potential government incentives. Several factors will shape this trajectory,including infrastructure growth,electricity supply stability,and consumer awareness. Continued investment in charging infrastructure will be paramount to allaying range anxiety and encouraging wider EV adoption.Recent reports indicate a 35% increase in public charging stations in major South African cities over the past year.

Frequently Asked Questions About EV Import duties

• Are EVs subject to special import taxes in South Africa? No, the import duty on EVs is generally 25%, the same as for most other imported vehicles.
• Why do EVs from Europe seem more expensive? EVs from Europe face a 25% import duty, while petrol and diesel vehicles from Europe have a lower duty of 18%.
• Will import duties on EVs be reduced soon? The Clean Trade and Investment Partnership agreement is under review, but important changes are not anticipated.
• Are Chinese EVs more affordable? Yes, Chinese EVs are often more affordable due to lower production costs, but they still face the 25% import duty.
• What is the government doing to promote EVs? The government plans to introduce consumer incentives, but details are yet to be finalized.
• When will EVs reach price parity with petrol cars? Analysts predict price parity between 2026 and 2027.
• Will lowering import duties hurt local car manufacturers? Yes, reduced tariffs could negatively impact the South African automotive industry.

What are your thoughts on the current EV import duty situation in South Africa? do you think government incentives are necessary to accelerate EV adoption?

Are consumers being unfairly charged CO2 emission taxes on vehicles with zero tailpipe emissions?

Electric Vehicle Tax Ruse in South Africa Exposed: Are You Paying To Much?

The MyBroadband Inquiry & EV Tax Controversy

Recent investigations by MyBroadband have uncovered a concerning trend regarding electric vehicle (EV) taxes in South Africa. Consumers are facing potentially misleading tax implications when purchasing and owning EVs, stemming from ambiguities in the application of existing tax structures. This isn’t simply about higher costs; it’s about a lack of clarity and potential overpayment by South African EV owners. The core issue revolves around how EVs are categorized for tax purposes – specifically,Ad Valorem tax and potentially CO2 emission taxes,despite thier zero tailpipe emissions.

Understanding the Current Tax Landscape for EVs in South Africa

Currently, south Africa’s vehicle tax system isn’t fully adapted to the nuances of electric mobility. Here’s a breakdown of the key taxes impacting EV ownership:

* Ad Valorem Tax: This is a percentage of the vehicle’s value. EVs,often being more expensive upfront,attract a higher Ad Valorem tax than comparable internal combustion engine (ICE) vehicles.

* CO2 Emission Tax: While intended to discourage polluting vehicles, the application to evs is questionable. Despite zero tailpipe emissions, some interpretations suggest EVs are still subject to this tax, based on manufacturing emissions or battery production. This is the primary point of contention highlighted by MyBroadband.

* Import Duties: Many EVs are imported, incurring import duties that further increase the purchase price.

* VAT (value Added Tax): Standard VAT applies to all vehicle purchases, including EVs.

The Misleading Application of CO2 Taxes to Zero-Emission Vehicles

The crux of the issue lies in the interpretation of the CO2 emission tax. The South African Revenue service (SARS) guidelines haven’t explicitly exempted EVs from this tax, leading to inconsistent application by dealerships and potentially incorrect billing.

Here’s why this is problematic:

1. Contradiction of Policy: Incentivizing green vehicles and together taxing them for zero emissions undermines the government’s stated commitment to reducing carbon footprints.
2. Financial Burden: The added CO2 tax, even if relatively small, increases the overall cost of EV ownership, making them less accessible to the average consumer.
3. Lack of Openness: Many consumers are unaware they are being charged this tax, or the rationale behind it.

Real-World Examples & Reported Cases

MyBroadband’s reporting details several instances where EV buyers were charged the CO2 emission tax despite owning vehicles with zero tailpipe emissions. While specific amounts vary depending on the vehicle model and value,these charges add up,contributing to the higher total cost of ownership. One reported case involved a Tesla Model 3 owner being charged an additional R15,000 in taxes, which, upon investigation, included a disputed CO2 emission component. These cases highlight the need for clear guidelines and consistent application of tax laws.

What Does This Mean for South African EV Buyers?

This situation creates uncertainty and potential financial disadvantage for those embracing sustainable transport. Here’s what you need to know:

* question Every Charge: Carefully review your purchase agreement and tax invoice. Specifically, scrutinize any line items related to CO2 emissions.

* Request Clarification: Ask your dealership for a detailed breakdown of all taxes applied and a clear explanation of the CO2 emission tax component.

* Seek Second Opinions: If you suspect an error, consult with a tax professional specializing in vehicle imports and taxes.

* Document Everything: Keep copies of all documentation related to your EV purchase, including the purchase agreement, tax invoice, and any correspondence with the dealership or SARS.

The Role of SARS and Potential Policy Changes

The MyBroadband exposé has prompted calls for SARS to clarify its position on EV taxation. Industry stakeholders are advocating for:

* Explicit Exemption: A clear and unambiguous exemption of EVs from the CO2 emission tax.

* Revised Tax Structure: A review of the overall vehicle tax structure to better reflect the environmental benefits of EVs.

* Incentive Programs: The introduction of financial incentives,such as tax breaks or subsidies,to encourage EV adoption.currently, South Africa lags behind other countries in offering considerable EV incentives.

Benefits of Electric Vehicles – Why Clarity Matters

Despite the tax challenges, the benefits of switching to an electric car are critically important:

* Reduced Running Costs: Electricity is generally cheaper than petrol or diesel.

* Environmental Benefits: Zero tailpipe emissions contribute to cleaner air and a reduced carbon footprint.

* Quieter Operation: EVs offer a smoother and quieter driving experience.

* Lower Maintenance: EVs typically require less maintenance than ICE vehicles.

However, these benefits are diminished if the cost of ownership is artificially inflated by misleading or inappropriate taxes.

Practical Tips for Navigating EV Taxes in South Africa

1. Research Thoroughly: Before purchasing an EV, research the applicable taxes and potential costs.
2. Compare Quotes: Obtain quotes from multiple dealerships and compare the total cost of ownership, including taxes.
3. Negotiate: Don