Ukraine Still Dreaming
of an Electric Car

Ukraine has reduced the tax on the purchase of electric cars and is now among the world’s leaders in the growth rate of electric automobile ownership.

Since the beginning of this year, the buyers of electric vehicles do not pay VAT and excise duty. The preferential tax treatment will be in force during all of 2018.

Even earlier, at the end of 2015, Ukraine abolished the import customs duty on electric vehicles. The demand for these vehicles immediately jumped. According to the newspaper “Segodnya”, the number of electric cars in Ukraine reached more than four thousand at the end of 2017. By comparison, in Norway, there are 137 thousand electric cars, where the population is 1/10th that of Ukraine. Nevertheless, in Ukraine there are more of these cars than in other post-Soviet countries, such as Russia, Belarus and Moldova.

Experts are discussing how much the price of electric cars will come down, due to the reduction of taxes since the beginning of this year. Nazar Shimone-David, co-founder of Tesla Club Ukraine, who deals with the development of infrastructure for Tesla cars, predicts that electric cars will be 17% cheaper in Ukraine than in Europe. But his opponents are not so optimistic and believe that high demand can lead to price increases.

The market of electric cars in Ukraine is basically being filled with used Nissan Leaf vehicles from the USA, with the average price for one starting at 4-5 thousand dollars. In any case, the sale of imported electric vehicles in Ukraine is a profitable business.

Unfortunately, the automobile industry of Ukraine does not produce its own electric car, although such plans at one time were ripe. Back in 2008, the public organization “Electromobile” that developed the state program for development of the e-car industry, had hoped the state would adopt that program.

The initiator of the “electric car” program was the engineer Nikolay Parafenko, who lived in the Kiev suburb of Bucha.   This contributed to Bucha becoming  the center of the public movement for environmentally friendly cars.The mayor of Bucha, Anatoly Fedoruk, confirmed this fact to our correspondent, recalling that a dramatic ecological motor race there, Bucha (Ukraine) – Monte Carlo (Monaco) 2015, , made  history in Bucha city, with 40 cars having participated. The route of the electromobile rally was over 3,000 kilometers and ran through 10 countries and 17 cities in Europe.

Nikolai Parafenko died in 2014, before the rally and the boom of imported electric vehicles in Ukraine. The documentary evidence of his active work, was left on the Internet. However, the implementation of the state program of promising eco-car models, developed by Nikolai Parafenko, has not begun.

Fortunately, this idea has not disappeared without a trace. This year, there has already appeared in public forums a statement by the first vice-premier of Ukraine, Stepan Kubiv, that the possibility of cheap electric cars production in Ukraine has the potential to attract foreign investors.

But for this to happen, experts say it will be necessary to rework the tax structure not only for the import and purchase of cars, but also for their production at home in Ukraine.

 

by Evgeny Semenyak  (Kiev, Ukraine)

(translation by Viktoria Yanchuk and Tatiana Anokhina)

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