S. Africa weighs tax rebates, subsidies to boost EV adoption

South Africa is exploring tax rebates and subsidies to encourage electric vehicle (EV) adoption, President Cyril Ramaphosa announced on Thursday.

As the country transitions its automotive industry, global automakers like Ford, Volkswagen, BMW, and Toyota, which manufacture locally for South Africa and Europe, are under increasing pressure to shift towards electric and hybrid models due to stricter regulations in key markets.

Ramaphosa highlighted the government’s consideration of incentives for both manufacturers and consumers to boost EV sales. Moreover, Finance Minister Enoch Godongwana previously announced a 150 per cent allowance for qualifying investments in electric and hydrogen vehicles, effective from March 2026.

South Africa is also advancing policies to support “new energy vehicles,” including hybrids, and aims to foster domestic battery production.

A white paper released last year advocated for government incentives and a temporary reduction in import duties on EV batteries to support local production and green hydrogen fuel cell development.

“We are committed to working hand-in-hand with the private sector to promote the production of new energy vehicles and the development of the necessary infrastructure to support them,” Ramaphosa emphasised.

Attribution: Reuters

Subediting: M. S. Salama