The past few weeks, there has been much discussions in the electric vehicle industry regarding the tax reform that’s been proposed by the government.
The initial tax reform Senate plan excludes funding for the Plug-In Electric Drive Vehicle Credit. The up to $7,500 tax credit for purchasing an electric vehicle was put in place as an incentive for car buyers to go electric when purchasing to help jump start the industry in the United States. The exclusion of this credit in the House of Representative’s tax plan affects potential electric vehicle buyers because the prices of these cars without the credit can make the the choice between a cheaper fuel car or a more expensive electric car that much more difficult.
The credit was intended to expire for electric vehicle manufacturers after each sold 200,000 units. Fortunately for manufacturers and potential buyers, the updated tax reform plan introduced by the Senate keeps these credits in place. While the main reason for taking away these tax credits was to see if the electric vehicle industry can hold up on its own, having incentives to stimulate the industry will speed up the process to get fuel cars off the road and more clean energy efficient electric cars to be the standard. Hopefully the fears of manufacturers and car buyers will be diminished when the final tax reform bill is passed keeping the tax credit in place. To read more, click here.