Main drivers for local tax incentives to promote electric vehicles: The Spanish case

Abstract

Cities are one of the main agents behind the introduction of electric vehicles. In Spain, cities could establish up to a 75% deduction on vehicle tax based on environmental issues. This paper analyzes those variables affecting the establishment of such a measure using the Probit model on a sample of 395 Spanish municipalities. The results show that the urban population, its dispersion, and the municipalities’ environmental commitment positively affect the establishment of such incentives, while the rural nature of the population and unemployment do exactly the opposite.