US Senate Democratic Electric Vehicle Tax Credit Plan Faces Questions

Under a deal announced by Senator Chuck Schumer, the 200,000-vehicle per manufacturer cap on the $7,500 electric vehicle (EV) tax credit would be lifted and a new $4,000 used EV tax credit adopted.

David Shepardson, Reuters

Automakers and U.S. lawmakers on July 28 were closely reviewing details of a proposed expansion of the electric vehicle (EV) tax credit that could help retool factories to build green vehicles and cut greenhouse-gas emissions.

Under a deal announced by Senator Chuck Schumer, the 200,000-vehicle per manufacturer cap on the $7,500 EV tax credit would be lifted and a new $4,000 used EV tax credit adopted. Lawmakers and automaker executives want to know more about whether content sourcing requirements will bar many if not all EVs from getting tax credits and if consumers will be able to use it at the time of sale.

The new EV tax credit would be subject to rising annual sourcing requirements for critical minerals and components used in batteries. Congressional aides and automakers said the provisions were aimed at China, which produces much of the world’s critical minerals for batteries.

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