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Italian parliament gives green light to new car scrappage scheme

Car retailers in Italy will benefit from a post-COVID sales boost after the country’s government gave the green light to scrappage scheme incentives for buyers.

According to a report published by Reuters, a package of incentives to encourage sales of both “state-of-the-art” internal combustion engine (ICE), as well as hybrid and electric vehicles (EV) was given the go-ahead on Friday (July 3).

Rome will offer buyers of Euro 6 vehicles with a price lower than 40,000 euros (£36,151) 3,500 euros (£3,164), if they scrap a car that are 10-years-old or more, according to the legislation voted on by the Lower House’s budget committee.

Existing subsidies for EVs ands will also be bolstered, according to the report.

Italy’s decision to boost its automotive sector with a vehicle scrappage scheme – which would also aim to reduce emission – is in-line with incentives announced in France and Germany.

At the start of May four industry associations representing Europe’s automotive sector joined forces to call for car scrappage schemes as part of a 25-point COVID-19 coronavirus recovery plan.

ACEA, CECRA, CLEPA and ETRMA revealed their plan to ensure a strong restart, laying out the details a joint letter sent to the European Commission and the European Parliament.

Last month the German government doubled its share of the existing purchase incentive for electric cars and hybrid cars, paying a grant of €6,000 (£5,370) for a pure EV in addition to an OEM-backed subsidy of €3,000 (£2,685).

In-line with its eco-friendly car purchase incentive scheme, the German government also plans to reform its tax system to ensure higher-emitting vehicle pay higher taxes from January 2021.

Days earlier, at the end of May, France announced an increase in the state-provided grant towards an electrified vehicle purchase from 7,000 euros (£6,243) from 6,000 (£5,342).

Car buyers looking to invest in a traditional car will receive a 3,000-euro bonus under a scheme, meanwhile, as part of an effort to help car retailers sell and estimated 400,000 left in stock following the COVID-19 coronavirus lockdown.

In the UK, it appears that Government has canned any scrappage scheme plans, however.

The Times reported that a letter from Rachel Maclean, junior minister for transport and the environment, had put paid to the idea. It said: “The government has no plans at this stage to introduce a scrappage scheme.”

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