Rising Electric Car Prices. NBU Initiative

Electric vehicles are rapidly taking over the Ukrainian market — thanks to eco-friendliness, cost-effectiveness, technological progress, and tax incentives. Ukraine remains one of the few European countries where major tax breaks on import and use of electric cars have been in place for several years. However, major tax changes are expected in 2025–2026, which will dramatically impact both electric vehicle prices and state revenues.

Tax incentives: the current regime
As of November 2025, importing electric cars into Ukraine is exempt from the following charges:

• Import duty (10%)
• VAT (20%)
• Pension Fund fee (3–5%)

The only mandatory payment is a symbolic excise of 1 euro per 1 kWh of battery capacity. For instance, a 60 kWh car battery incurs just 60 euros in excise. This means purchasing and customs clearance for EVs is now much more favorable than for comparable ICE cars.

Required documents and customs details
To register an electric vehicle, you need to submit the standard document set, with nearly zero extra payments. The owner must also pay the excise and (temporarily!) a VAT deposit, refunded within 10 days. This process simplifies matters and lowers barriers for eco-conscious buyers.

Transport tax and usage rules
Despite overall favorable taxation, a transport tax may apply if the vehicle is:

• under 5 years old,
• has an average market value above 3 million UAH.

The 25,000 UAH annual tax applies only to premium models, so most EV owners do not pay it.

Changes in 2025–2026: what’s next
The biggest factor for all buyers is that tax breaks are only valid until December 31, 2025. From January 1, 2026, VAT at 20% returns to EVs:

• VAT (20%) — applied to the car’s customs value, raising the final price by roughly a fifth.
• Import duty (10%) is still waived, but draft laws on its reinstatement are under review.
• Excise remains at 1 euro/kWh.

That’s why analysts and dealers advise registering EVs by end-2025, while the “tax fast-track” remains.

Legislative moves & the auto future lobby
Several bills in 2025 propose extending the benefits until 2027 (or the end of martial law) or reducing VAT for hybrids, but most experts expect a gradual end to “zero” taxation — state finances require new streams, and the growing EV fleet shrinks the tax base.

Fiscal effect for the government
According to the Ministry of Finance and the tax service, the state lost nearly 15 billion UAH to EV tax breaks in 2025, though this spurred imports of over 160,000 new cars.

Social and environmental factors
Due to tax incentives:

• More “clean” cars are available,
• CO2 emissions and pollution are reduced,
• Charging infrastructure is developing,
• The latest models arrive from world brands.

Demand has soared — in 2025 alone, over 37,000 new EVs were sold.

Import challenges and new “schemes”
Expansive EV imports from the US, China, and EU are possible due to today’s tax regime. But “spare part” importing and price manipulation schemes have spread, to which Customs and Tax Authorities respond. An electronic registry for tracking history and value is proposed.

Business incentives: importing e-transport and parts
Businesses also benefit from incentives importing e-vehicles, batteries, charging stations, and parts, accelerating domestic production and innovative mobility.

Possible post-2026 scenarios

• Full return of VAT (20%) and duty (10%) will slow imports and make EVs a luxury item,
• Progressive transport tax for luxury EVs (costing over 3 million UAH),
• Possible introduction of eco-levies in the future.
• Domestic industry incentives could include partial tax credits or lower VAT for local makers.

Practical tips for EV buyers in 2025

1. Register by December 2025 to save 20–30% of the price.
2. Prepare customs paperwork carefully; check the battery capacity and contract price.
3. Use only official import channels to avoid financial and legal risks.
4. Watch for legal changes — monitor benefit extension news.

Conclusion
Ukraine’s 2025 electric vehicle tax system combines business and civic incentives with ecological and smart-infrastructure gains. But from 2026, owners, importers, and dealers must prepare for heavier fiscal burdens — now is the time to take advantage of the “final window” for affordable EVs!
Prudent planning, legal support, and timely paperwork are key for smart purchases under fast-evolving tax rules.
Author: Ihor Yasko, Managing Partner, WINNER Law Firm, PhD
Given rapid changes, optimal taxation and safe EV registration are possible only with expert support: contact WINNER Law Firm to ensure your interests are protected even during a new wave of tax changes.