Shockingly, it appears the U.S. Congress has found some bipartisan support for a new bill that would extend the federal electric car tax credit for automakers. General Motors and Tesla, the two automakers in the U.S. that have triggered the phase-out period, have already signaled support.
According to a Reuters report on Wednesday, the bill, called the Driving America Forward Act, would extend and boost the electric car tax credits from the current 200,000 to 600,000 credits. Per the legislation, that would give GM and Tesla around 400,000 credits to play with, since both have already sold over 200,000 qualifying vehicles.
For automakers that have not reached the 200,000 credit cap, they’d be eligible for the current $7,500 credit to pass along to buyers. For automakers that have reached the current cap, they would get a slightly less $7,000 for the remaining 400,000 credits. Once an automaker exceeds the proposed 600,000-credit cap, the sunset period would shrink from 15 months to nine months in the new legislation.
The bill is somewhat of a halfway point behind previous Republican proposals to provide more credits and have them expire altogether early next decade and Democratic proposals to simply provide unlimited credits for 10 years. Other Republican lawmakers and the Trump administration have supported their ending altogether.
Key Democratic sponsors of the legislation include Michigan Senators Debbie Stabenow and Gary Peters. On the Republican side, sponsors include Tennessee Senator Lamar Alexander and Maine’s Susan Collins. Michigan Democratic Rep. Dan Kildee also signaled he would support the legislation in the House of Representatives.
Aside from GM and Tesla, which have lobbied Congress for an extension and boost in credits, other automakers that support the bill are Honda, Toyota, Ford, Nissan, and Volkswagen.
Additionally, the bill would allow for newcomers to the industry to take advantage of the electric car tax credit, just as the current law allows. This would include any new Chinese automaker that enters the U.S. and new electric car startup companies.
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Source: Reuters
Comments
There needs to be a hard and fast end point to this credit so the tax payers aren’t subsidizing latecomer manufacturers, thereby penalizing the companies that took advantage of the incentives to develop the technology early on. Whether that’s now or in the future, there needs to be an end date for all tax credits, no matter how many cars have been sold.
It was a stupid idea anyway. How about a $7500 credit for HSA’s.
Credits like this are the proper function of government. If we can’t switch over to renewable energy consumption we’re going to be dealing with incredible problems going forward. This is a reasonable investment to accelerate the development/adoption of what is the obvious future of transportation.
Yes, Agreed. If the United States doesn’t support industry in the development of this new technology, we will be supporting the Chinese automobile industry into the future. Governments in Europe and China are supporting their electric vehicle industries and if we don’t, we will be left behind.