Petition Calls For Increase Of EV Tax Credit Manufacturer Cap
Originally published on EV Obsession.
Many of those who recently put down a $1,000 deposit for the Tesla Model 3 did so with the intent of trying to make it in before the 200,000 units sold mark was achieved by Tesla — thereby beginning the phase-out of the federal $7,500 plug-in electric vehicle tax credit.
Granted, most of those that put down deposits would very likely have eventually ended up ordering a Model 3 anyways — but there’s no doubt that the approaching phase-out of the federal tax credit was a driver for increased reservations.
What if the federal tax credit manufacturer limit of 200,000 vehicles was increased though? Popular demand seems to be pushing for that to happen, with a new petition recently popping up on the White House website calling for exactly that.
Here’s the text for that petition (which was started on April 2):
Increase the EV tax credit cap per manufacturer.
Internal Revenue Code Section 30D provides a credit for Qualified Plug-in Electric Drive Motor Vehicles including passenger vehicles and light trucks.
The credit begins to phase out for a manufacturer’s vehicles when at least 200,000 qualifying vehicles have been sold for use in the United States.
A significant amount of consumers across the United States this past week have made the choice for an electric vehicle over a fossil fuel vehicle. Many of those consumers will be ineligible for the credit because of the phase out and many more will decide not purchase an electric vehicle because certain manufacturers will exceed the 200,000 vehicle cap.
We ask the White House to help change legislation to increase the tax credit cap in order to further promote the use of alternative fuels.
As of the time of this writing, the petition tally stands at only 1,709 signatures, so head on over if you want to try and get your voice heard on the matter.
For some clarification here — after the 200,000th eligible vehicle is sold by any manufacturer, the full tax-credit remains in effect for the rest of the quarter in question, as well as for the following quarter. The second calendar quarter that follows after the quarter when the 200,000th vehicle is sold is when the tax-credit starts being reduced. The first two quarters (6 months) after this begins, there will still be a 50% tax-credit available; and the two quarters after that will still allow for 25% of the full tax-credit to be claimed.
So, if the 200,000th vehicle is sold at the beginning of a quarter, then there will still be a roughly 6-month time period in which those who take delivery of their vehicle can claim the full $7,500 tax-credit.
Reprinted with permission.
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At least that is better than places like BC, Canada, there is a limit on what the incentive is (not a tax credit, but a cash incentive) but is for a minimal amount of cars, as in #’s, and that is used up quite fast.
The government talks the talk but does not provide. :((
Of course the EV tax credit should be extended.
I just signed the petition and it was remarkably fast and easy. Sign it!
It should be changed from 200,000 per manufacturer to 50,000 per manufacturer and 20,000,000 in the USA market. That puts pressure to come into the market sooner verse later.
EVs are now completely competitive and affordable and there is no need for tax credit.
They will be when each car maker has at least 3 models of BEV’s in their offering and with the right pricing.
“no need for tax credit.”
Oh, God forbid EV’s get a tax credit. It’s not like reducing [CO2] is important or anything. And by all means, let’s keep our precious tax credits/ subsidies for:
3-martini business lunches
children (with no limit)
fossil fuels, to the tune of $5 trillion a year world-wide
Megachurch real estate holdings, investments, salaries – they pay zero
home mortgages
CEO bonus pay
Capital gains
FICA salary cutoff
Gift tax exemption
After all, we can trust the fate of human civilization to the market. It always works toward the good of the people. Just ask the Koch brothers – they will agree.
Reducing CO2 would have been taken care of in a much better way If 5hey had put those money in public transport insted of giving it to people buying $70-100k cars.
I don’t think you realize how much Tesla has accelerated the growth of EVs.
A lot of people don’t want to or can’t use public transportation. EVs built from sustainable materials give us the benefits of public transportation but on an individual level.
Affordable is relative. There are still many people who cannot afford a $35,000 car. Maybe we extend the credit for another few years, until a new EV can be had for the price of a Nissan Sentra, i.e. ~$17,000. Or maybe we need to do a better job of pointing out the lower total cost of ownership of an EV over its life so that the higher sticker price is less of a deterrent.
I’d be really happy with a $7k (or something close) for EVs with a solid 100 mile range selling for $25k or less.
And I’d be happy to see the subsidy means-tested. A $10k or more loan paydown subsidy for those people with low incomes and then fade the subsidy to a couple of thou for those in higher tax brackets.
The S was introduced in 2012 when battery prices were much higher. If sales price started to depress sales then Tesla almost certainly has room to drop the price a bit. Same will likely hold for the 3. Dropping battery prices should make room for price cuts later on.
In 2014, the 60 came out at ~$75K with SC access. In 2015, the 70 came out at $70K, SC access included. In 2017/18, the 3 will come out at $35,000 base. If battery prices continue to drop and other manufacturers get on board, maybe in 2020 we will have a 200mi range EV at ~$18,000. Wouldn’t that be great.
Whenever I hear “ok EV and/or RE don’t need tax support any more”. And it doesn’t start by calling for all fossil fuel support to end at least 5 years before. All I hear is “full of sh#t”. Coal has been supported for over a hundred years, it is documented that they are even paying full royalties when they pull it from public ground. Yes, I know they use “legal” shell companies to sell to 10 times. So that they can claim they pay the full amount.
I’d be okay if they extended the number for pure EVs, but I’m also wondering if Tesla could, besides making sure number 200,000 is shipped the first day of the next quarter, could they have you buy the car in that next quarter when you’re still getting the full credit, even if it isn’t going to be made for another month or two? Some might not mind putting up the money to get the credit, or maybe even a bank could be okay with the loan starting before delivery since you’re still going to be getting the car brand new when it is made.
I have a feeling there won’t be too much support for this petition.
300,000 folks lined up for the Model 3.
Most understand that the tax credit is bonus, not a guarantee.
Subsidies should be phased out “as planned”, so nobody gets dependent on “extension creep”.
Personally I would prefer is they just changed it so all automakers get the rebate no mater how many are sold with phase out being based on dates. 2020 100%, 2021 50%, 2022 25%. That would make things simpler for all.
Alternatively, a single number (e.g., 2 million) of rebates available to all at full rebate with a phaseout. This way automakers have a strong competitive incentive to invest and manufacture product as quickly as possible.
As it stands, the early entrants are penalized in the out years when their sloth-like competition finally gets around to producing.
I will consider a phase out of EV subsidies only when the last ICE auto comes off the assembly line. Ending RE subsidies – in a world chock-a-block full of tax subsidies – has got to be the single worst idea in the history of bad ideas. You might as well staple a sign onto your forehead that says “I don’t understand the ramifications of Global Warming or how we even got to where we are”.
Subsidies are how civilizations encourage wise behavior without resorting to governmental edict. I suppose if we made ICE autos illegal, we would not need EV subsidies. Somehow I think people who call for phaseouts of EV’s – even though they still have tiny market penetration – might be against criminalizing the use of an ICE car?
I expect by 2020 that EV to be a solid percentage of overall Car sales and I am not talking about 1% either.
I hope you’re right.
As someone paying for this
If we can’t get a Supreme Court Nominee to even be interviewed by the Republican Senate, there isn’t much hope for an extension. Forget about plowshares, what they want is more weapons.
Maybe the best way would be to allow each taxpayer a one-time tax credit for buying their first EV. Once they experience the advantages, they may not go back to ICE cars.