Tuesday, July 5, 2022
News U.S. Democrat EV Tax Credit Proposal Would See Up to $12,500 Credit

U.S. Democrat EV Tax Credit Proposal Would See Up to $12,500 Credit

New US EV credit moving to next step

  • Credit would give extra amounts for union-made EVs

  • Extends credit five years, would make GM and Tesla re-eligible

A new US EV tax credit plan was revealed last Friday by the House Ways and Means Committee. The new incentives pay out big rebates for EVs, and even more for vehicles that get union content or have U.S. sourced batteries.

The new EV incentive plan (via The Detroit News), would add a $7,500 consumer rebate at the point of sale for all-electric vehicles. This would apply for five years, a big change from the current $7,500 tax credit that began to expire once an automaker hit 200,000 EVs sold and that have already left behind GM and Tesla.

In addition to that initial EV rebate, the plan would pay out an extra $4,500 for vehicles that were assembled in a union facility. $500 would be added for vehicles with an EV battery made in the U.S., while a smaller credit would be created to help boost the sales of used electric vehicles.

The proposal is part of a $3.5 trillion spending bill that covers a wide range of tax and spending measures. The committee, composed of Democrat lawmakers, will vote on the proposal tomorrow. It is likely that the measure would face difficulty in the U.S. Senate, where Republican party senators have harshly criticised EV spending.

Other restrictions on the new credits would include an adjusted gross income of no more than $400,000 to quality, and limit cars to $55,000 with trucks at $74,000.

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