What Are The Peruvian Government's Electric Vehicle Subsidy Policies?

The Peruvian government is promoting the adoption of electric vehicles through a combination of policies. Core measures cover four key areas: tariff exemptions, tax incentives, scrappage subsidies, and support for charging infrastructure. The following are the latest policy details for 2025:

Tariff Exemption

Under the New Electric Vehicle Law, which came into effect in November 2024, the import tariff on pure electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs) will be reduced from 6% to 0% for five years. This policy directly reduces vehicle import costs; for example, the landed price of a model like the BYD Song Plus can be reduced by approximately $1,800.

VAT and Consumption Tax Exemptions

VAT (IGV): The import and local sales VAT on electric vehicles and charging infrastructure will be fully exempted from 18% for 10 years.

Insulation Tax (ISC): The insulation tax on electric vehicles has been reduced to 0% since 2018, further reducing vehicle purchase costs. Property Tax: Property tax on electric vehicles will be reduced from 1% to 0% for five years.

Import Quota Adjustment: In April 2025, Peru will reduce the duty-free import quota for new energy vehicles from 50,000 to 33,000. This reduction primarily targets fuel-powered vehicles, while electric vehicles will continue to enjoy zero tariffs. This adjustment aims to balance market demand and avoid over-reliance on imports.

High Subsidies for Public Transport Vehicles

Buses: Replacing traditional diesel buses with electric or hybrid vehicles can receive a subsidy of up to US$25,000 (vehicle replacement); simply scrapping highly polluting vehicles can receive US$20,000.

Trucks: Electric truck purchases are eligible for a 10% income tax deduction, valid for 15 years.

Taxi and Private Vehicle Subsidies

Taxis: Replacing gasoline vehicles with electric vehicles can receive subsidies of US$3,500-5,000; replacing them with natural gas vehicles (NGVs) offers lower subsidies (US$800-2,000). Private Vehicles: There are currently no direct purchase subsidies, but indirect cost reductions are provided through tax breaks (such as a full VAT exemption).

Drivers whose vehicles are scrapped without financial incentives will be given priority for public transportation system selection and receive technical training opportunities.

Construction Subsidies and Tax Incentives

Income Tax Exemption: Enterprises investing in charging infrastructure can enjoy a 15% income tax exemption, valid for 15 years.

Special Fund: The government will initially inject 5 million soles (approximately US$1.2 million) into the "Electric Transportation Promotion Fund" to provide guarantees for loans for charging infrastructure construction.

Construction Goals and Layout

The plan is to add 300 new fast-charging stations by the end of 2025, focusing on highways, airports, shopping malls, and other areas.

The capital, Lima, already has 160 public charging points, and companies such as Enel X and China's Star Charge are advancing commercial deployments.

Technical Standards Adaptation Peru plans to develop technical standards for charging stations by 2025, and encourages the adoption of China's GB/T standards to be compatible with Chinese brand models such as BYD.