Government revises EV property tax formula

PanARMENIAN.Net - Armenia’s government has approved changes to how property tax for electric vehicles is calculated, with the new system applying to existing EV owners without retroactive recalculation.

Changes will be made to the rules for calculating property tax on electric vehicles, according to a decision adopted at a government meeting.

Interior Minister Arpine Sargsyan said the proposal was submitted based on applications received from citizens. Over the past year, several requests were filed raising the need to change the registration procedure so that a uniform approach could be ensured in property tax calculations, 1lurer.am reports.

The minister explained that currently two indicators of engine power are used when calculating electric vehicle taxes: maximum or peak power and continuous power. According to her, international practice generally gives preference to continuous power, as it allows a vehicle to be driven for extended periods without damaging the battery. Peak power, she said, is used for short-term acceleration and often shows higher figures for marketing purposes.

Sargsyan noted that Armenia’s internal regulations currently use peak power as the main indicator, whereas under the common regulations of the Eurasian Economic Union (EAEU) only electric vehicles with electronic passports are registered in the system, and those passports list only the continuous power rating.

According to the minister, the following approach has been proposed: if the vehicle listed in the registry has an electronic passport indicating continuous power, that figure will serve as the basis for calculating property tax. If such data is unavailable, a coefficient-based calculation mechanism will apply.

For electric vehicles with peak power of up to 250 horsepower, the figure will be divided by a coefficient of 1.5. For vehicles with peak power exceeding 250 horsepower, the first 250 horsepower will be divided by 1.5, while the remaining portion will be divided by 2.5.

The minister provided examples, noting that if an electric vehicle has 544 horsepower of peak power and was produced in 2025, its current property tax amounts to 666,000 drams, while under the new mechanism it would be about 276,000 drams. In another example, an electric vehicle with 218 horsepower of peak power currently pays 133,400 drams, but under the new calculation it would amount to about 43,500 drams.

It was noted that the changes will affect around 20,000 individuals and about 4,000 legal entities in total. The regulation will also apply to citizens who already own electric vehicles, but no retroactive recalculation will be carried out.

According to Sargsyan, the new calculation will apply starting January 1, 2026, while the regulation will formally enter into force on April 1, 2026. She said this period has been allocated so citizens will not need to submit additional applications, as digital platforms will be updated and users will automatically be able to see the new calculation data on the Road Police platform.

The minister also stressed that the regulation is planned to remain in force until December 31, 2028, after which its effectiveness will be evaluated and authorities will decide whether to maintain the same regime or introduce further changes.

According to her, the reform could also contribute to the growth of electric vehicle circulation in Armenia.