White House proposes upping EV credit to $10k

http://www.metrotaxict.com/pressroom/2014/03/white-house-boost-ev-alternative-vehicle-tax-credits-to-10000.html#more" onclick="window.open(this.href);return false;

"The White House is proposing cutting taxes on liquified natural gas to spur the use of the fuel by alternative vehicles, while again calling for hiking the maximum tax break for electric vehicles and other advanced vehicles to $10,000, over the current $7,500."

Does not apply to Luxury cars over $45k (i.e., Tesla S and Cadillac)

Who knows if this will make its way through congress or not.

However, it's nice to dream... 2015 Leaf with 150 mile EPA range, $10k tax credit, sigh

No chance of passage in the current congress...

charge said:

"... while again calling for hiking the maximum tax break for electric vehicles and other advanced vehicles to $10,000, over the current $7,500."

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TomT said:

No chance of passage in the current congress...

charge said:

"... while again calling for hiking the maximum tax break for electric vehicles and other advanced vehicles to $10,000, over the current $7,500."

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Yeah, the house majority is firmly against cutting taxes.... :x Um, wait... :? :lol:

Tax cuts are pro-capitalism. Unless they're for ecological goals then they're pro-socialism.

Politics is so confusing these days.

charge said:

Does not apply to Luxury cars over $45k (i.e., Tesla S and Cadillac)

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Or RAV4-EV. Although it would set a price point for new models. I could see the RAV MSRP adjusted to $44,999 within a week.
Model E would also be encouraged to come in just under.

smkettner said:

charge said:

Does not apply to Luxury cars over $45k (i.e., Tesla S and Cadillac)

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Or RAV4-EV. Although it would set a price point for new models. I could see the RAV MSRP adjusted to $44,999 within a week.
Model E would also be encouraged to come in just under.

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Or some versions of the BMW i3. The base BEV version would qualify, but only leave room for less than $3k of options. The REx version wouldn't qualify.

Interesting. Whether the rebate gets upped to $10k or not, I hope some of the other changes also mentioned will get implemented without too much of a fuss. eg:

The Treasury proposal would also allow the dealer to offer a point-of-sale rebate to buyers rather than requiring taxpayers to file for the tax credit on their income taxes. The White House also wants to lift the 200,000 vehicle cap per manufacturer after which the credit phases out over a year. Instead, the White House would begin to phase out the credit starting in 2019 for all manufacturers.

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The POS rebate would be extremely convenient and, IMO, would not cause as big a fluctuation in seasonal sales (high towards the end of the year, low at the start of a new year). Lifting the 200k cap is also a big deal IMO.

I imagine that would also prompt MB to come in a little under $45k for their new B class. But I figured BMW's i3 pricing was probably going to prompt that anyway.

This could make most nice options on a i3, B or RAV4 extremely pricey. An option that moved the price to just over $45k would cost an extra $2.5k. LOL - I can see people asking the dealer to remove the mud flaps to get under the level and then retrofit them back on.

Perhaps it would make more sense to have a $10k tax incentive which declines dollar for dollar on purchases over $45k. Thus a $46k nicely equipped i3 would get a $9k tax break and a $50k base RAV4 would still get a $5k tax break. An EV would have to be $55k+ for no tax break.

A POS rebate would also make these much more attractive to those who don't pay enough income tax to realize the benefit of the tax credit. That represents a huge market. A Smart ED at $25k with $10k Federal and $2.5k California rebates would be a $12.5k car - less than any other new cars out there. And when you factor the lower operating cost, this approach could really boost ED adoption.

This would be bad news for existing owners as their cars will lose $2,500 in value overnight.

charge said:

http://www.metrotaxict.com/pressroom/2014/03/white-house-boost-ev-alternative-vehicle-tax-credits-to-10000.html#more

"The White House is proposing cutting taxes on liquified natural gas to spur the use of the fuel by alternative vehicles, while again calling for hiking the maximum tax break for electric vehicles and other advanced vehicles to $10,000, over the current $7,500."

Does not apply to Luxury cars over $45k (i.e., Tesla S and Cadillac)

Who knows if this will make its way through congress or not.

However, it's nice to dream... 2015 Leaf with 150 mile EPA range, $10k tax credit, sigh

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Just the yearly pandering to the base, in full knowledge that it isn't going to happen.

DarthPuppy said:

I imagine that would also prompt MB to come in a little under $45k for their new B class. But I figured BMW's i3 pricing was probably going to prompt that anyway.

This could make most nice options on a i3, B or RAV4 extremely pricey. An option that moved the price to just over $45k would cost an extra $2.5k. LOL - I can see people asking the dealer to remove the mud flaps to get under the level and then retrofit them back on.

Perhaps it would make more sense to have a $10k tax incentive which declines dollar for dollar on purchases over $45k. Thus a $46k nicely equipped i3 would get a $9k tax break and a $50k base RAV4 would still get a $5k tax break. An EV would have to be $55k+ for no tax break.

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I suggested some time back that a cap of say $35-$40k decreasing dollar for dollar above that and with the cap adjusted downwards every year or two seemed like a good idea, assuming that the idea of the credits is to drive prices down to the point that the middle class can seriously consider these cars. I forget exactly what value I settled on, but I decided the RAV4EV was too expensive to be mass market (U.S. median LDV price $31k), so set it below that. Oh, and to prevent games, I thought the subsidy amount should be based on the out-the-door price less government fees rather than MSRP.

If necessary to get this passed (not that that's going to happen), I would much rather see the incentive cut to $5k if we could trade that for making it an instant rebate. I'm not, though, in favor of extending the incentive beyond 200,000 per manufacturer. The whole point of that is to encourage companies to enter the field early when costs are higher, so that they can benefit from knowledge down the road; the latecomers will have to take the chance that it makes more sense to let others take the early risks so they can reap the benefits without the work, instead of being so far behind that they can't catch up.

Valdemar said:

This would be bad news for existing owners as their cars will lose $2,500 in value overnight.

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Only for owners of 2014 models. I don't think that would change the resale value of a 2011 or 2012 at all and would have only a minor effect on 2013 cars.

If you can only get $10,000 for a 2011 leaf in a year or two but a new leaf is still $29,000 there is a lot of buffer between those cars.

Besides those of us not making 6 figures can't even make use of the whole $7,500 rebate now. I'm stuck looking for used cars that have been treated well and don't have much battery degradation because many buyers did use the whole $7,500 the used price is significantly cheaper for me no matter how high they raise the tax rebate.

dhanson865 said:

Valdemar said:

This would be bad news for existing owners as their cars will lose $2,500 in value overnight.

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Only for owners of 2014 models. I don't think that would change the resale value of a 2011 or 2012 at all and would have only a minor effect on 2013 cars.

If you can only get $10,000 for a 2011 leaf in a year or two but a new leaf is still $29,000 there is a lot of buffer between those cars.

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You're probably right, considering I was offered $10,000 for my '11 on a trade-in already now...