Tax breaks are available for many people considering an electric vehicle through the Inflation Reduction Act
America’s pivot to electric vehicles has had a rocky few months, with hesitant consumers reluctant to shell out the premium EVs command and hybrid models somewhat stealing the sector’s thunder. Now, a report has calculated just how much the U.S. government has spent encouraging people to go electric and it’s an awful lot.
Tax breaks are available for many people considering an electric vehicle through the Inflation Reduction Act, which offers a $7,500 rebate on EVs that meet a few strict criteria. Now, Automotive News reports that more than 250,000 tax credits have now been cashed in by buyers, costing the U.S. government more than $2 billion, as the site explains:
The U.S. government has issued $2 billion in advance point-of-sale consumer EV tax credit payments since Jan. 1 covering more than 300,000 vehicles, the Treasury said Oct. 1.
Since new rules took effect this year allowing for consumers to take advantage of EV tax credits worth up to $7,500 at the point of sale, more than 250,000 tax credits have been issued for new EVs and around 50,000 for used models that carry up to $4,000 rebates.
Nearly all involve transferring the credit to a car dealer at the time of purchase resulting in a significant rebate.
Seems like a lot, but it’s worth noting that, according to the Natural Resources Defense Council, fossil fuels emissions costs the U.S. a staggering $820 billion in just health care costs alone. Two billion is a drop in the bucket
As it stands, the tax break on EVs is only available on select electric models and to select households across the U.S. Specifically, the tax break can only be claimed by households that earn less than $300,000 for married couples and $150,000 for individuals. A list of vehicles that qualify for the $7,500 tax break can be found here.
The $7,500 rebate offered by the government isn’t the only saving that EV buyers will pick up when they choose to switch to electric power. In addition to the savings at the point of sale, a report from the treasury found that EV owners save, on average, between $18,000 and $24,000 over a car’s 15-year lifespan compared with someone that bought a comparable gas-powered car.
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