EV Tax Incentive

MrMike777

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So now that the left is in power, do you think they’ll remove the $7,500 tax incentive limitation for Tesla?
 

Crissa

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That's the plan.

Will the Republicans block it in the Senate? They have blocked altering the EV incentives for eight years, so...

-Crissa
 

braddibbnd

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The incentives when they were introduced tried to do 2 things. 1) Encourage buyers with a tax discount to help adoption. 2) Incentivize manufacturers to build EV/hybrid vehicles with a bigger market possibility.
I don't see the manufacturers incentive as a good carrot anymore. With Tesla/VW and others showing the late comers that they either build zero emission vehicles very soon or join the list of Studebaker/Packard etc.
I would hope that the incentive does change to include all qualified vehicles and maybe have an income phase out like California. My CT reservation is probably 2 years out so I've got my fingers crossed but is not a variable in my purchase decision.
 

Crissa

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There's also the problem that Battery-Electric Vehicles will always have that cost of the battery, which is a big upfront 'fuel' cost. The incentives bring the actual cost of BEVs down to where they can compete with traditional, cheap, internal combustion engine vehicles that have more maintenance and no upfront 'fuel' cost.

It's an unalloyed good to have no emissions from the point of use. BEVs cause less health risk than ICE vehicles. Much of the difference between the criminality and health of rich and poor can be attributed to proximity to vehicle emissions because of damage that those emissions have had, from lead poisoning to asthma to cancer rates.

-Crissa
 

DarinCT

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Remove? Tesla lost theirs. You mean bring back?

-Crissa

Remove the limitation of so many vehicles.
tl;dr: Yes but it won't help us.

A House Select Committee (basically a one project committee) has already formed, investigated, and released their report. They're members are filled like another committee in the House, bipartisan with one extra to the majority.

Important part highlighted down below, rest included for the curious.

Building Block: Extend Consumer Tax Credits for the Purchase of Electric Vehicles

Tax incentives and consumer rebates play an important role in driving consumer demand for new products or technologies, such as electric vehicles. The Institute of Transportation Studies at University of California-Davis identified 32 studies that show a positive relationship between financial purchase incentives and the sale of electric vehicles in the United States and globally.

Under current law, consumers purchasing an electric vehicle can receive a tax credit of up to $7,500. Once an automaker sells more than 200,000 electric vehicles, then the tax credits for the automaker’s vehicles begin to phase out permanently. To date, Tesla and General Motors have hit the 200,000- vehicle cap.

On April 10, 2019, Rep. Dan Kildee (D-MI) introduced H.R. 2256, the Driving America Forward Act, which raises the cap and allows each automaker to sell an additional 400,000 vehicles with an accompanying $7,000 tax credit. The bill maintains the $7,500 tax credit for the first 200,000 electric vehicles sold per manufacturer. Sens. Debbie Stabenow (D-MI), Lamar Alexander (R-TN), Gary Peters (D-MI), and Susan Collins (R-ME) introduced S. 1094, the Senate companion. House Ways and Means Committee Democrats included this approach in Section 401 of the Growing Renewable Energy and Efficiency Now (GREEN) Act of 2020 (H.R. 7330), which the House Democrats added to their comprehensive infrastructure legislation, the Moving Forward Act (H.R. 2).

Some members have taken a different approach. Rep. Peter Welch (D-VT) and Sen. Jeff Merkley (D-OR) introduced the Electric Credit Access Ready at Sale (CARS) Act of 2019 (H.R. 2042/S. 993). The Electric CARS Act eliminates the per-manufacturer cap entirely and authorizes it for 10 years. The bill also aims to expand electric vehicle adoption to lower- and middle-income consumers by allowing buyers to use the tax credit over a five-year period or apply the credit at the point of sale. In December 2019, Rep. Jackie Speier (D-CA) introduced the Affordable American-Made Automobile Act (H.R. 5393). Among its many provisions, the bill increases the electric vehicle tax credit to $15,000 for cars costing less than $35,000, which could make electric vehicles more accessible to middle-class households.

Recommendation: Congress should raise the per-manufacturer cap on the electric vehicle tax credit to support the deployment of these vehicles. Congress should consider making these tax credits refundable to make it easier for lower- and middle-income Americans to afford to buy electric or setting a transaction price cap to extend the life of the credits and apply to households most likely to benefit from and be motivated by the credit. Congress also should consider offering tiered incentives for electric vehicles based on their domestic content and adoption of strong labor standards at the facilities that manufacture or assemble the vehicles.

Committee of Jurisdiction: Ways and Means

Page 100 of the pdf, page 90 of from the Climate Action Plan of the Select Committee on the Climate Crisis

Home page to Select Committee

There is nothing in the Green New Deal about electric vehicles.

Many of "the left" as well as pretty much every US manufacturer support increased CAFE standards which the manufacturers were achieving. "the right" attempted to put a hold on that for 2022-2026, these new targets went into effect in 2020. My point is the new administration has stressed environmental policies but the way the carrot and stick manifest may come in a variety of different forms, including some not listed here. I suspect none of those forms will help with the 2022 purchase of a CyberTruck.
 

azjohn

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IMO if the 7500 tax credit gets extended have a price limit such as $50-60K, if you can afford a $90K car you don't need a tax break and have the rebate come off the price of the car when you purchase instead of when you do your taxes

If the new administration does increase the tax rebate on EVs they will get their money back in other increased taxes
 

DarinCT

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The 116th Congress has no influence on the 117th Congress.
Sure, I'll take the bait. How exactly did you come to the conclusion that previously elected officials who hold the same office and the same positions for the same constituents are independent between Congresses?
 

Crissa

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Sure, I'll take the bait. How exactly did you come to the conclusion that previously elected officials who hold the same...
Well, they're not exactly the same. There will be different people, and people change and situations change.

And most importantly, it was a one-project committee. That means when they do it this year, it will be different people even if no Representatives retired, died, or lost their seats.

-Crissa
 

GnarlyDudeLive

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My suspicion is that EV's are not ALWAYS going to be vastly cheaper to "fuel" for much longer as adoption rates of EV's climb. There is a lot of money lost is bypassing gas taxes. My state is already vastly increased the plates registration to start to compensate for those lost monies. I still think overall its going to be cheaper mileage but not nearly as wide of a gap. Illinois originally tried to pass (it failed) a $1000 per year EV registration fee but now it currently sits at $251....
 

EVCanuck

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IMO if the 7500 tax credit gets extended have a price limit such as $50-60K, if you can afford a $90K car you don't need a tax break and have the rebate come off the price of the car when you purchase instead of when you do your taxes

If the new administration does increase the tax rebate on EVs they will get their money back in other increased taxes
I believe that's a wrong way to look at it. The incentive is to give advantage in buying EV vs ICE. If someone has 90k to spend on a vehicle why would he choose a 90k BEV vs an equally performant (let's say in total cost of ownership) 89k ICE vehicle?
 

T3slaDad

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Great discussion, but you're all overlooking one thing: Tesla has historically lowered their prices a the incentives went away to almost an identical proportion.

If we got an EV credit again, Tesla would likely increase the cost of the vehicles to reflect that credit, making it a wash. 9nce the credit goes away, prices would come back down.

Granted, there were a lot of variables in play last time around, such as the M3 pre-release, capital issues, company livelihood hanging on the success of the M3, etc, but I wouldn't be surprised if this happened again.

Especially around the release timeframe of the CT, the vehicle price would just be magically higher than estimated at the reveal. Aw shucks. Then the credit goes away and voila! Tesla unlocks a way to magically drop the price by the same or very similar amount!
 

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