Senate Deal Includes Up to $7,500 in EV Tax Credits

A new U.S. Senate bill would give new and used EV buyers tax incentives and the car industry billions to switch to electric vehicles.

A compromise between Senate Majority Leader Chuck Schumer and Democratic Senator Joe Manchin retains the present $7,500 EV tax credit but lifts the 200,000-unit production threshold, so GM, Tesla, and Ford can rest easy.

Single purchasers with a $150,000 income and families with a $300,000 combined income can get credit for cars up to $55,000 and trucks, vans, and SUVs up to $80,000.

First-time used EV buyers will get aid. Up to $4,000 in credits will be offered on automobiles costing no more than $25,000 for customers with lower incomes.

Inside EVs reports that the new credit may be granted as a rebate at the point of sale, making a new EV more affordable.

In President Biden's original proposal to offer $12,500 in incentives, he included $4,500 for union-made vehicles. The measure removes that condition.

To aid the local auto sector, cars must be made in North America and using largely domestic materials.

North America's auto industry will also get further aid. If the measure passes, it will provide $2 billion in cash grants to help current auto facilities become EV-ready, $20 billion in loans to develop new EV plants, and $30 billion in tax credits to stimulate U.S. manufacturing of solar panels, wind turbines, batteries, and minerals used in batteries.