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Published on December 10th, 2017 | by Nicolas Zart


Thanks To Popular Pressure, The Senate Left The Electric Car Tax Credit Alone (For Now)

December 10th, 2017 by  

Senate Leaves Electric Car Tax Credit Alone2017 has been an interesting year for electric vehicles (EV). We’ve seen more EVs on the road and at auto shows internationally, but affordability hasn’t changed that much. Worse yet, in the US, the new administration has been on a rampage returning to the good old polluting days, with carmakers colluding and allowing the environment to be further damaged.

This is a story of what can happen when enough people get together and tell politicians enough is enough. Next: Net Neutrality and other environmental topics?

Popular Demand Pressures Senate to Leave Electric Car Tax Credit Alone … For Now

Plug In America is an advocacy group that has been fighting for EVs for a good 15 years. The group has accomplished a lot in the meantime. The most recent was forcing the Senate to stop slowing down EV adoption. And this wouldn’t have happened without consumers putting their foot down and taking part in a democracy or shifting the overbearing lobby pressures that manipulate our political landscape.

The EV incentives are not very well understood. Most people know $7,500 can essentially be deducted from the price of an electric car, but don’t know much more than that. While you can get $7,500 back after buying an electric car, it can’t be deducted from the actual purchase of the vehicle — the incentive comes in the form of a tax credit (a reduction in the amount of tax you owe) and depends on a few things. Mainly, it depends on the battery pack capacity (kWh) of the car being bought.

The problem is that the game isn’t won yet on even this one topic. The US House and Senate are now tasked with “reconciling” the two bills that have been passed. In the House one, the EV tax credit was cut. In the Senate one, as just noted, it wasn’t. Which of these options will they choose when the reconcile the bills for a final draft?

Senate Leaves Electric Car Tax Credit Alone

There are also a few other myths Plug In America is trying to dispel around EV incentives.

The EV incentive doesn’t only benefit rich folks. According to Plug In America: “The tax credit states that qualifying new EV purchases are eligible for a base tax credit of $2,500, plus an additional amount based on the battery capacity of the vehicle, not to exceed $5,000. So, depending on the EV you’re purchasing, you might not get the full $7,500. The full benefit of the credit really depends on what you choose to drive, not on how rich you are.”

But when it comes to leasing EVs, the confusion becomes apparent. Many folks we talk to assume EV incentives don’t apply to leases. Indeed, the credit applies to leases in a way since it typically gets rolled into lower prices or better terms, which benefits low and middle-class consumers.

Plug In America Leads The EV Revolution

Although it’s easy to blame governments for every woe on the planet, government interference isn’t as strong in the marketplace as we are led to believe. Complacency and believing in marketing without a critical approach is a much bigger problem for consumers.

Without the prior involvement of governments to assist technologies in maturing and moving into the mass market, most of the technologies that we take for granted today would have taken a few more decades to make it into production. The original 2008 EV tax credit is a perfect example of this. It will still phase out when a vehicle manufacturer sells more than 200,000 EVs for any make or model. It phases out over the course of a year to 50% of the full credit amount and then down to 25%, then finally down to zero.

Plug In America also reminds us that eliminating the credit would hurt the taxpayer in a variety of ways. EVs provide many benefits, not least of all national security. There is also an undeniable fuel saving for consumers. Once we start seeing more vehicle-to=home (V2H) and vehicle-to-grid (V2G) features coming to the market, it will help make our aging electric grid more resilient.

We know the clean air point has resurfaced lately. One way to look at it is that putting pressure on utilities at the chimney is much easier than on millions of individual cars on the road. We’ve already seen what carmakers will do to cheat and deceive with gasoline cars. And there are less tangible benefits, like the fact that EVs reduce healthcare costs, due to less pollution in the air and healthier lungs.

Perhaps the biggest one is that of tightening our national security by making sure we consume our own energy as we progress towards clean, abundant, and renewable local energy instead of importing foreign petroleum and all the geopolitical implications that come with that.

Senate Leaves Electric Car Tax Credit Alone

So, this one is for all of you who have taken an active stand in democracy by participating and not simply voting and forgetting about everything for the next 4 years. Democracy is a relationship that needs our input. Forget boisterous activists, become a smart advocate.

Get more from Plug In America on Facebook, Twitter, Instagram, YouTube, and LinkedIn


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About the Author

Nicolas was born and raised around classic cars of the 1920s, but it wasn't until he drove an AC Propulsion eBox and a Tesla Roadster that the light went on. Ever since he has produced green mobility content on various CleanTech outlets since 2007 and found his home on CleanTechnica. He grew up in an international environment and his communication passion led to cover electric vehicles, autonomous vehicles, renewable energy, test drives, podcasts, shoot pictures, and film for various international outlets in print and online. Nicolas offers an in-depth look at the e-mobility world through interviews and the many contacts he has forged in those industries. His favorite taglines are: "There are more solutions than obstacles." and "Yesterday's Future Now"

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