U.S. Democrats Propose Extended Electric Vehicle Tax Credits For Big Three

U.S. Democratic lawmakers on Friday officially proposed a significant expansion of current tax credits for electric vehicles that would heavily favor union-made vehicles that produce zero emissions and are assembled in America. It is important to note that this does not imply a reduction in tax credits for other non-US vehicles.

The current tax credit for all zero-Emission vehicles is $ 7,500, and this will remain unchanged. American vehicles manufactured by unions will, however, benefit from a tax credit of $ 12,500.

It’s all part of President Joe Biden’s seemingly ambitious goal of securing half of electric vehicle sales in the United States by 2030. will be American-made vehicles. With this proposal, America could also see more critical union jobs being introduced to revitalize the positions of the Big Three automakers.

There are a few other things this proposal does – and doesn’t include -:

• The bill makes with the phasing out of tax credits for automobile manufacturers after the sale of 200,000 electric models. This would make Tesla and General Motors eligible for tax credits again.
• Used electric vehicles will benefit from a tax credit of $ 2,500, which is only eligible for vehicles over two years old and cheaper than $ 25,000, as long as your individual income is $ 75,000 or family income is $ 150,000.
• There is a basic tax credit of $ 4,000 for all electric vehicles. You will get a supplement $ 3,500 off if the EV has a battery of at least 40 kWh. There is still $ 4,500 if final assembly takes place at a unionized national plant, and $ 500 if at least 50% of the components and battery cells are made in the USA.
• The tax credit comes with income restrictions. If you earn $ 400,000 as a single person or $ 800,000 in a relationship, you will not qualify for the discount.
• There are also restrictions on the MSRP of vehicles. Anything more expensive than the following will be ineligible: $ 55,000 for sedans, $ 64,000 for vans, $ 69,000 for SUVs and $ 74,000 for pickup trucks.
• Funds will be allocated for charging infrastructure as long as this infrastructure is accessible to the public, capable of charging vehicles manufactured by several manufacturers and can be paid for by credit card.
• The bill would come into force in 2022.

Of course, it is important to remember that these are tax credits, no immediate discounts at the point of sale. So you will always pay the original price of your electric vehicle when you buy it and have to wait for a tax refund during tax season.

It is also important to note that this is only a proposal and is still the subject of legislative criticism.