Trump administration says it will end electric car tax credit in the strangest way

A Trump administration official has now announced that they are indeed planning to kill to the federal tax credit for electric vehicles, but they are offering a strange timeline as it is unclear if they even have the power to do it.

The situation around the federal tax credit for EVs is weirder than ever right now.

As Tesla hit the 200,000 delivery threshold to initiate the phase-out, there are two different legislative efforts to change the program.

Last month, a Republican senator introduced a new bill to end the $7,500 federal tax credit for electric cars and tax them even more instead.

But a few days later, another Republican senator proposed a new bill to remove the federal tax credit cap for EVs and expand it to 2022.

Republican Senator Dean Heller, who introduced the pro EV tax credit bill that would see it extended instead of capped, was defeated in the mid-term elections earlier this month.

With those two distinct bills, the Democrats regaining control of the House, and Republicans expanding their majority in the Senate, it’s really unclear what will happen of the EV federal tax credit.

Trump muddied the water even more last month when he threatened to kill GM’s electric car subsidies over factory closures.

But now, the Trump administration is apparently not just talking about electric car tax credits for GM vehicles.

White House economic adviser Larry Kudlow said that they plan to end EV subsidies as soon as 2020-2021, according to Bloomberg.

Electrek’s Take

The electric vehicle tax credit is part of the tax code and since Trump doesn’t control the house anymore, it’s unclear how they could actually put this into action.

To me, it looks like they are just showing their colors and it doesn’t look good for pro EV people.

What’s most ridiculous is that this first came up as a punishment for GM, but the timeline they are offering wouldn’t really affect GM, or Tesla, that much since they will have already run out of tax credits at this point.

It would affect foreign automakers looking to launch electric vehicles in the US.

Hopefully, this blows over and more politician starts listening to the coalition led by Tesla, GM, Nissan, and others trying to reform the EV federal tax credit.