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Republican Tax Plan Kills Electric Vehicle Credit (arstechnica.com)
An anonymous reader quotes a report from Ars Technica: The nascent market for electric cars will suffer a big setback if the Republican tax plan released on Thursday enters into law. Among the changes to the current tax code would be an end to the Plug-In Electric Drive Vehicle Credit. That's the tax incentive that currently means up to $7,500 back from the IRS when you purchase a new battery or plug-in hybrid electric vehicle. Since the start of 2010, the EV tax credit has been $2,500 for a plug-in vehicle with at least 5kWh battery capacity. Every extra kWh nets another $417 up to a maximum of $7,500, although you would need at least that amount in income tax liability -- the IRS won't cut you a check to make up the full amount. It was never meant to be permanent; once an automaker sells 200,000 qualifying vehicles (starting from January 1, 2010) its eligibility is phased out over a matter of months. But in the almost seven years since, no one has reached that limit yet. Tesla will almost certainly be first, with General Motors not far behind; between them, they've sold a lot of Model Ses and Chevrolet Volts. If this tax plan is enacted, it will surely mean pain for both companies, as well as anyone else hoping to sell a lot of EVs here in the U.S. The data is pretty clear -- tax incentives sell electric cars, and the market for EVs can dry up very fast when they're abolished, as Georgia's recent experience shows.
The theory behind them is that it is to keep America potentially self sufficient when it comes to food. Left to the free market, we would buy much cheaper food from overseas and American farms would shut down, not that there is anything wrong with that from a free market perspective. However if war were to break out and our source of cheap overseas food cut off, it could lead to famine if we don't have a local ability to produce food up and running to jump in and pick up the slack.
How well the subsidies achieve this and whether they are the optimal amount, I dunno.
What burden? California (and other blue states) contribute more to the Federal budget than they receive. It's the red-leaning states that are typically the net recipients of everyone's Federal tax dollars. Perhaps we should first stop the agricultural subsidies, which are counter-productive in every way (except to make big agricultural companies and wealthy farmers more wealthy).
The real "Libtards" are the Libertarians!
They are not loosing billions. They are investing in factory and expansion. Why parent post got 5 stars?