Original title: Car Rim | The US will revise preferential EV tax policies to help GM and Tesla explore the market Source: Tencent

According to foreign media reports, Mary Sapiri of EY's tax reporting team reported some potentially significant developments in the US federal electric vehicle tax credit, which are included in the “2019 Continued Growth in Renewable Energy and Energy Efficiency Act” or the “2019 Green Act” draft.

US Congressman Mike Thompson is a member of the powerful organization's fundraising committee, which is the main tax drafting committee of the US House of Representatives. This means that this draft should be taken seriously.

For Tesla and GM, the bill is a potentially huge victory.

The current electric vehicle tax credit policy in the US

As early as 2010, the US Congress passed a tax credit policy for electric vehicle buyers. Consumers are eligible for a $7,500 tax refund after purchasing a new electric vehicle.

According to relevant regulations, once an automobile manufacturer has delivered 200,000 electric vehicles in the US, the above tax refund policy will be gradually abolished over the next four years.

Tesla took the lead in “triggering” this regulation in the third quarter of 2018, while GM followed suit in activating the policy in the fourth quarter of 2018. As a result, Tesla car buyers will not be able to enjoy the tax refund policy after December 31, 2019, while GM buyers' policy will expire after March 30, 2020.

According to some opinions, this means that the electric vehicle tax credit now mainly benefits latecomers in the electric vehicle industry, while companies that introduced electric vehicles earlier must not be “punished.”

New electric vehicle tax credit policy (section 401 of the draft regulations)

The delivery threshold for car companies was raised from 200,000 to 600,000 vehicles. The tax credit was reduced from the current $7,500 to $7,000.

If electric vehicles sold by Tesla and GM in 2019 only meet part of the tax credit policy, these sales volumes will not be included in the new 600,000 vehicle delivery threshold.

New preferential tax policies for used electric vehicles (section 402 of the Bill)

For the first time, the federal government will provide tax credits of up to 2,500 US dollars for consumers who buy used electric vehicles, but the actual implementation of this policy has many limitations. Used electric vehicles that meet the above tax breaks should sell for at least $25,000.

The model year of the used electric vehicle must be at least two years before the consumer bought the car (for example, you cannot buy a 2019 model in 2020). Also, used electric vehicles must have previously been used and registered in the US by someone else, not the buyer. The tax credit must not exceed 30% of the sales price.

The amount of the tax credit is tied to the income of the car buyer. For situations where the parties' adjusted total income exceeds 30,000 US dollars (if a married taxpayer submits a joint tax return, this amount is doubled), for every 1,000 US dollars (or less than 1,000 US dollars), the tax discount amount for the purchase of a used electric vehicle is reduced by $250 for every $1,000 (or less than $1,000).

The same consumer can only enjoy the tax credit policy for the purchase of used electric vehicles once every 3 years. This policy will expire on December 31, 2024.

New tax policies for heavy electric vehicle manufacturers (section 403 of the Bill)

The draft provides manufacturers (not consumers) with a 10% investment tax credit for the sale of zero-emission heavy vehicles.

A “zero-emission heavy vehicle” is defined as a vehicle with a total weight of at least 14,000 pounds, is not driven or charged by an internal combustion engine, and is only driven by an electric engine (the electric engine is powered by batteries or fuel cells).