A bipartisan group of lawmakers plans to introduce a bill to expand federal tax credits for buyers of electric vehicles, in what could be a boon for the growing EV market, CNBC writes.
The existing $7,500 tax credit for buyers of EVs phases out over 15 months once an automaker sells 200,000 electric cars. The tax credit for Tesla buyers was halved to $3,750 on Jan. 1; General Motor’s tax credit was likewise cut in half starting April 1.
The bill, dubbed the Driving America Forward Act, would grant each automaker a $7,000 tax credit for an additional 400,000 vehicles after it exhausts the first 200,000 vehicles eligible for tax credits. It would shorten the phase-out schedule to nine months. The credits are paid directly to consumers, who can write them off on their tax returns.
“At a time when climate change is having a real effect on Michigan, today’s legislation is something we can do now to reduce emissions and combat carbon pollution,” Sen. Debbie Stabenow, D-Mich., one of the sponsors of the legislation, said in a statement. “Our bill will help create American jobs and cement Michigan’s status as an advanced manufacturing hub.”
Tesla shares rose 1.6 percent in morning trading on Wednesday. Sens. Gary Peters, D-Mich., Lamar Alexander, R-Tenn., and Susan Collins, R-Maine, and Rep. Dan Kildee, D-Mich., signed on to the bill.
Electric vehicles comprise a tiny, but growing, share of the U.S. vehicle market. Support for low- and no-emissions vehicles has grown both in the U.S. and in other major automotive markets, such as China. Though Tesla has been a market leader in EVs, several automakers are planning to release fully electric cars, trucks and SUVs over the next few years, CNBC added.