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Thursday, December 9, 2021

Tax credit used for electric vehicles, bonus created by union, part of the House of Representatives social and climate bill now directed to the Senate

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The infrastructure and social policy bills passed by the U.S. House of Representatives this week include many provisions on electric vehicles, from investments in charging infrastructure to a rejuvenated electric vehicle tax credit. Now they go to the Senate.

The Build Back Better Act (HR 5376) replaces the current federal tax credit for electric vehicles with a new one that removes the 200,000-unit limit for manufacturers to qualify. The base credit is $ 4,000 while vehicles with batteries of 40 kWh or more qualify for the same $ 7,500 as the current credit.

The credit also includes an income limit of $ 250,000 ($ 500,000 for joint taxpayers) and price limits of $ 80,000 for pickup trucks, SUVs, and pickup trucks, and $ 55,000 for all other vehicles. Starting in 2027, only vehicles assembled in the US will be eligible for the credit.

2022 Chevrolet Bolt electric vehicle and electric vehicle production begins

2022 Chevrolet Bolt electric vehicle and electric vehicle production begins

The controversial union bonus It also reached the final version of the House tax credit, which adds $ 4,500 for vehicles assembled in national union factories. Has been significant recoil against the unionized bonus, particularly from automakers with nonunion US factories.

Another surprise is that a used electric vehicle tax credit has come this far. Proposed earlier this year, the final version of House includes a base credit of $ 2,000 and an additional $ 2,000 for electric vehicles in use before January 1, 2027 with battery packs of not less than 40 kwh, for a total potential of $ 4,000.

The used electric vehicle tax credit is effective January 1, 2022 and expires December 31, 2031 and has an income-based phase-out of $ 200 for every $ 1,000 of a person’s modified adjusted gross income. taxpayers that exceed $ 250,000 ($ 500,000 for joint taxpayers).

2015 Chevrolet Spark EV

2015 Chevrolet Spark EV

Meanwhile, the Infrastructure Investment and Jobs Act (HR 3684) includes $ 7.5 billion for electric vehicle charging, $ 5 billion for zero-emission and low-carbon school buses, and a grant program to fund the expansion of the manufacture of national batteries, among other provisions.

The next step for these EV-friendly policies is Senate approval. While both houses of Congress initially produced different versionsof the extended tax credit for electric vehicles, the Chamber he had already adjusted his version something in tune with the Senate in some respects, like the price limit for vehicles.

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