The German government has said it will not extend the country’s successful car-scrappage subsidy that has seen new car sales rise sharply this year.
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The scheme, which gives consumers EUR2,500 (US$3,577) if they trade in a vehicle nine years old or more for a new, more fuel-efficient model, has boosted sales which were almost 30% up on the year in July according to the KBA motor vehicles agency, and are running 26% ahead year on year.
Since the subsidy came into operation in February, its budget has been increased once to EUR5 bn (US$7.1bn) but the government has now said no alternative scheme is being considered.
Handelsblatt newspaper said members of the ruling coalition parties are considering tax incentives on car purchases for car workers, hoping to counter the sales slump they fear once the scrapping subsidy expires.
However, a government spokesman said there was no tax incentive plan.
