What’s the new tax credit Rule? How will it affect EV buying in the US

Electric Cars in the US lose tax credit as new Rule kicks in, Details

US Tax News: The U.S. Treasury said that a number of electric cars, including the Nissan Leaf, Tesla Cybertruck All-Wheel Drive, several Tesla Model 3s, and Chevrolet Blazer EV, lost their eligibility for tax credits of up to $7,500 as a result of new battery sourcing regulations that went into effect on electric cars in the US.

US Tax News: Electric Cars in the US lose tax credit as new Rule kicks in

The new regulations make it more difficult to receive the full $7,500 credit for cars that have components sourced from China and other nations that the Treasury Department has designated as “foreign entities of concern.”

To lessen their dependency on Chinese suppliers, many automakers are racing to establish battery plants in the US, but it will still take them years before these businesses can manufacture an electric vehicle without sourcing parts and materials from China.

This implies that some highly favoured electric cars, such as the Ford Mustang Mach-E and the majority of Tesla Model 3 models, are no longer qualified for the tax credit. A large number of GM’s new EVs using its Ultium battery technology are also ineligible, including the Cadillac Lyric and Chevrolet Blazer EV.

How many vehicles are eligible for the incentive now?

There are now only 19 EV models eligible for US EV tax credits, down from 43 previously. Various models of the same vehicle type are included in those numbers. According to the Treasury, the list may vary because some manufacturers have not yet submitted data on qualifying automobiles.

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