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The $7,500 electric vehicle tax credit is still in danger as Senate passes tax reform [Updated]

Early this morning, the U.S. Senate passed their major tax bill after weeks of debate and according to the latest available information, it looks like the federal tax credit for electric vehicles is still in danger despite some changes since the original introduction of the bill that removed the incentive.

Update: we are receiving other reports suggesting the EV tax credit wasn’t removed from the approved bill with Senator Flake’s amendment, but it is still unclear. We actually don’t know exactly what they passed and most senators probably don’t either if we are being honest.

Update 2: The amendment is now confirmed not to be in the bill that passed in the Senate – document in full further down.

After the House GOP bill was introduced with the removal of the $7,500 federal tax credit for electric vehicles, several Republican Senators said that they were going to remove the proposal from the Senate bill.

But another amendment on Thursday was added by Jeff Flake, a Republican senator from Arizona, which included the language ending the federal tax credit for electric vehicles on December 31, 2017.

  SA 1746. Mr. FLAKE submitted an amendment intended to be proposed to 
amendment SA 1618 proposed by Mr. McConnell (for Mr. Hatch (for himself 
and Ms. Murkowski)) to the bill H.R. 1, to provide for reconciliation 
pursuant to titles II and V of the concurrent resolution on the budget 
for fiscal year 2018; which was ordered to lie on the table; as 

       At the appropriate place, insert the following:


       (a) In General.--Subpart B of part IV of subchapter A of 
     chapter 1 is amended by striking section 30D (and by striking 
     the item relating to such section in the table of sections 
     for such subpart).
       (b) Conforming Amendments.--
       (1) Section 38(b) is amended by striking paragraph (35).
       (2) Section 1016(a) is amended by striking paragraph (37).
       (3) Section 6501(m) is amended by striking ``30D(e)(4),''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to vehicles placed in service in taxable years 
     beginning after December 31, 2017.

The bill’s amendment was apparently approved on the bill that the Republican voted for in the Senate early this morning (hat tip to rodney8).

That’s the latest information that we have available on the bill. They have not released the full version that was approved yet.

Update 2: The amendment is now confirmed not to be in the bill that passed in the Senate – document in full further down.

Now the bill is going to the House, which has its own version of the bill that removes the EV tax credit, but it’s not clear how it will come out for electric vehicle buyers after they reconcile it with the new Senate bill.

Electrek’s Take

Nothing is concrete yet and electric vehicle buyers are still left with more questions than answers. I’m not a tax expert, but it looks like there are so many major changes in this bill that the EV tax credit is just an afterthought seen as collateral damage.

If you were looking to buy an electric vehicle in the coming months, I would recommend pulling the trigger right now in order not to take chances.

Last month, we posted a report on ‘How to approach buying a Tesla or any electric car with the proposed end of $7,500 tax credit next month.‘ It still stands for most vehicles aside for Tesla’s custom orders, which can’t be delivered in time at this point since vehicles need to be “placed in service” by the end of the month.

Tesla’s new inventory vehicles can still be delivered in time and we expect that they will go fast because the timeline for the likely end of the tax credit also matches Tesla’s end of the free unlimited access to the Supercharger network with a purchase through Tesla’s referral program (you can use our code to get the free Supercharger access).

For other electric vehicles, we also expect inventories to be limited as people fear the end of the federal tax credit. You can check with your local dealers for inventory: Chevy Bolt EV, Hyundai Ioniq Electric, Nissan Leaf.

Here’s the bill in full:

[scribd id=366135483 key=key-2T5ZMu0cw93ioR3e1onK mode=scroll]

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