Austria: New Motor Vehicle Insurance Tax (VIT) rules from April 2025

On 18^th March 2025, the Budget Restructuring Measures Act 2025 (7/2025) was published in the Austrian Federal Law Gazette.

Among other tax measures, the Insurance Tax (IPT) Act was amended. In Austria, the IPT Act includes rules for the taxation of insurance policies covering motor vehicles. The changes can be summarised as follows:

a)     Abolishment of the Motor Vehicle Insurance Tax (VIT) exemption for electric cars

b)     Introduction of specific VIT rates for electric cars

c)      VIT exemption remains for motorcycles

d)     New VIT deduction rules for plug-in hybrid cars

The new rules are effective as of 1^st April 2025, however, payments of the VIT difference resulting from these changes should take place by 15^th November 2025 (or at the latest by 17^th December 2025).