Canada has announced the extension of its electric vehicle (EV) purchase incentives under the ‘Incentives for Zero-Emission Vehicles’ (iZEV) program, with no specified end date. Originally set to conclude on March 31, 2025, the program will now continue, offering subsidies of up to 5,000 Canadian dollars per qualifying vehicle, totaling a budget of 607.9 million Canadian dollars.
According to the 2024 budget announcement, the iZEV program, which began in 2019 and covers battery electric vehicles, plug-in hybrids, and fuel cell cars, has significantly impacted the adoption of zero-emission vehicles. The share of zero-emission vehicles in all new vehicle sales reportedly increased from 3 percent to 11 percent in 2023, with over 450,000 such vehicles purchased or leased in Canada since the program’s inception.
Despite the extension of purchase incentives, the new budget does not include additional funding for charging infrastructure. However, it introduces a ten percent tax credit for investments in buildings for the assembly of electric vehicles and for the production of batteries and active cathode material for electric vehicles.
Canada’s incentives and tax credits are expected to further boost the country’s EV and battery production sector, which has seen significant growth due to its abundance of raw materials, access to clean energy, NAFTA membership, and U.S. subsidies under the Inflation Reduction Act.
In a statement, a government representative emphasized the importance of these initiatives in driving sustainable transportation: “Our commitment to electric vehicles is unwavering. By extending the iZEV program and introducing tax credits for EV production, we aim to accelerate the shift towards a greener, more sustainable transportation sector.”
