With a compromise spending bill that devotes more than $360 billion to climate change efforts, consumers for the first time will have a tax incentive to use toward previously owned electric vehicles.
Related: Here’s how the Inflation Reduction Act’s rebates and tax credits for heat pumps and solar can lower your energy bill The new draft spending bill is much more modest than the $3.5 trillion version Democrats originally put forward. But it restores some of the sustainable energy, EV and broader environmental efforts that featured prominently in early versions, It also comes at a time when Americans, and many around the world, are struggling with high inflation, recession jitters and volatile energy prices RB00, -0.14%.
“By a wide margin, this legislation will be the greatest pro-climate legislation that has ever been passed by Congress,” Democratic Senate Majority Leader Chuck Schumer has said.Tax breaks for buying EVs have some requirements. New EVs will need to be built with minerals — such as high-demand lithium and cobalt — that are extracted or processed in a country with which the U.S. has a free trade agreement.
EV industry participants say the inclusion of lower-priced used EVs is key to ramping up a transition from emissions-spewing traditional engines to zero-emission alternatives. And Shahidi said as car buying shifts away from dealerships to direct purchases, that can likely boost EV access.
The rush is on to buy a $50k car for a $4k tax break 👍