The Automóvel Club de Portugal (ACP) has proposed three measures to the Government that it considers urgent, within the scope of the State Budget for 2025, including direct support of up to 6,000 euros for scrapping end-of-life vehicles.

In a statement, the ACP said it had proposed three “urgent measures to renew the vehicle fleet, help motorists and the economy”, highlighting that “there are more than six million light passenger vehicles circulating in Portugal with an average age of over 13 years, one of the highest in the European Union” which constitutes “a threat to European sustainability goals and a huge risk factor for road safety”.

Therefore, the association advocates that the incentive for scrapping end-of-life vehicles be resumed urgently, since the measure was included in the State Budget for this year, but has not been implemented. The ACP believes that the measure should be implemented through direct support for scrapping an end-of-life vehicle, covering all light vehicles over 15 years old.

Specifically, an incentive of 4,000 euros is proposed for those who scrap their vehicle and buy a new or used passenger vehicle up to four years old, and 6,000 euros for new or used light commercial vehicles up to four years old. If the vehicle is only scrapped at a certified centre, without purchasing new or used vehicles up to four years old, the ACP proposes a direct incentive of 1,000 euros.

In addition, the ACP also proposes updating the tax brackets for company vehicles, whose autonomous taxation has been divided into three brackets since 2011: for vehicles up to 25,000 euros, between 25,000 and 35,000 euros and over 35,000.

“Only in 2018 was the minimum limit adjusted to 27,500 euros, although the intermediate rate had already been adjusted (from 20% to 27.5%). In other words, there has been an increase in taxation over the last 13 years without any review of the threshold for the tax brackets, despite the annual inflation reflected in taxes on motorists”, pointed out the ACP.

The association considers that, by keeping the minimum threshold for the maximum tax bracket unchanged since 2011 (from 35,000 euros), the tax becomes “blind”, since “it pays for both a luxury car and a utility vehicle”, and, it stresses, “not even the reduction in the autonomous tax rate that occurred in the 2024 Budget compensates for this tax injustice”.

Finally, the ACP advocates the integration of the Environmental Fund into the State Budget with clear rules and a timetable defined at the beginning of the year, covering a greater number of beneficiaries. “Given the market supply and demand, environmental sustainability goals and the energy transition phase itself, it is proposed that this fund now cover the purchase of light hybrid passenger and goods vehicles (hybrids and 100% electric)”.