bayburt escort bilecik escort aydın escort osmaniye escort sivas escort erzurum escort ordu escort balıkesir escort gümüşhane escort ısparta escort giresun escort manisa escort aksaray escort çanakkale escort tokat escort
Manchin Floats Bill to End EV Tax Credits for Unqualified Cars

Manchin Floats Bill to End EV Tax Credits for Unqualified Cars

Manchin Floats Bill to End EV Tax Credits for Unqualified Cars

By Riley Beggin, The Detroit News (TNS)

West Virginia Democratic Senator Joe Manchin introduced a bill Wednesday that would immediately end the EV tax credit for vehicles that don’t meet federal battery and mineral standards.

If enacted, the new electric vehicle tax credit and its stringent content requirements would take effect without waiting for the U.S. Treasury Department to issue a rule, dramatically reducing the number of eligible vehicles. increase.

The Treasury missed the Dec. 31 statutory deadline to release draft rules for new credits enacted through the Inflation Reduction Act mediated by Manchin himself. Instead, the agency said it will issue those rules in March.

This creates a period of at least two months during which the law’s new battery and mineral requirements are exempted, benefitting new car buyers who would otherwise not be eligible for the credit.

Currently, 39 new EV models are likely eligible for full credit until the Treasury Department issues these rules, according to the IRS. When it comes down to it, I’m guessing most of these vehicles won’t qualify for credit.

Manchin, the conservative Democrat who created the Inflation Reduction Act, said it was “unacceptable” that the Treasury Department was allowing these vehicles to qualify while it worked on regulation. .

“The IRA is first and foremost an energy security bill, and the EV tax credit was designed to expand domestic manufacturing and reduce reliance on foreign supply chains for the critical minerals needed to produce EV batteries.” He said in a statement Wednesday.

“Being an automotive powerhouse is in our blood, so it is a shame that we rely so heavily on foreign suppliers, especially China, for the batteries that power our electric vehicles. I can not do it.”

Automakers will have to meet new standards to ensure the U.S. does not “become indebted to a country that does not share our values,” he added.

The Treasury Department did not immediately respond to a request for comment Wednesday, but said it was following the law as written.

Mr. Manchin’s bill faces a bumpy road ahead. Democrats appear uninterested in opening up the inflation-cutting bills they pass along party lines, and Republicans, who now control the House, are skeptical of subsidies.

The IRA amended the existing $7,500 EV tax credit program to remove the 200,000 vehicle limit per manufacturer. This would allow automakers such as General Motors and Tesla to again benefit from the deduction.

But it added provisions intended to encourage companies to build supply chains and manufacturing facilities within the United States and move them away from reliance on China, which currently dominates the global battery supply chain.

To get half the credit, the vehicle’s battery must have at least 40% of the value of vital minerals from the United States or countries that share free trade agreements, or recycled in North America.

At least 50% of the battery components must be sourced from North America to get the other half. Both thresholds are rising every year.

Also, the vehicle must be assembled in North America to be eligible for the credit.

Automakers have expressed concern that few vehicles will be covered once battery and mineral procurement requirements take effect. For example, General Motors says it can meet the requirements in the next two to three years.

Late last month, the Treasury Department issued initial guidance on how it would shape the rules proposed in March. Leased vehicles are likely to qualify for the commercial EV tax credit under the new law, opening up leased vehicles, car rentals, and vehicles used for rideshare fleets such as Uber and Lyft to pay for minerals and It said you can get the deduction even if you don’t meet the battery requirements. Or assembled in North America.

Manchin lashed out at the guidance and called on authorities to suspend implementation until it is in line with the intent of the law.

The Treasury Department’s guidance also broadly interprets what is considered a “free trade agreement” under the new law, limiting trade with at least Australia, Bahrain, Canada, Chile, Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras and Israel. said to include , Jordan, South Korea, Mexico, Morocco, Nicaragua, Oman, Panama, Peru, Singapore.


(c) 2023 Detroit News. Visit Distributed by Tribune Content Agency LLC.

Leave a Reply

Your email address will not be published. Required fields are marked *

%d bloggers like this: