New Tax Credit for Plug-In Hybrids Proposed

Texas Congressman Lloyd Doggett is proposing a new tax credit of $3,000 to $6,150 for people who buy a new plug-in hybrid vehicle. Of course, there are no plug-in hybrids on sale right now, but earlier this week we learned GM is shooting to start production of a plug-in of its own, the Volt, by 2010.

Doggett is part of the Ways and Means Committee, so he actually does have an impact on what gets added to the tax code. Tax credits on today’s garden-variety hybrids have a short shelf-life, expiring after a certain number are sold. Considering the first plug-in hybrids will probably cost much more than current hybrids, a tax credit might help draw in early adaptors. We’re wondering, though, why the bill is being done now when there are few plug-ins on the road. And is the all-electric plug-in Tesla sports car eligible?

[Doggett Files Bill Offering Tax Credits for Hybrid Purchases, Austin American Statesman via GMInsideNews]

Related:
Save the Date: Chevy Volt Plug-in Hybrid Coming in 2010

Comments

I wouldn't think the Tesla qualifies for the tax credit as-written since it's not a hybrid. It has no fuel-burning engine and is all-electric. But, if they're going to do tax credits for hybrids I think they should also do them for all vehicles with alternate energy systems such as: all hybrid types, all-electrics, hydrogen-powered, fuel cells, E85, biodiesel, CNG, etc. This would help encourage sales and development of these new technologies.

[kent beuchert]

I assume they mean up to $6,000 of income not subject to tax, rather than a tax credit of $6,000. Regardless, there is no good reason for subsidizing a plug-in hybrid - these car shave generated such enormous interest that I have to believe that Lloyd Doggert just got back from Mars. More likely, this is just one more expensive way to prove to Americans that Dems are "doing something" about energy. It will be interesting to have a law on the books that not only refers to a nonexistent vehicle but also subsidizes it. During that period, at least, the taxpayer won't be getting shafted subsidizing his neighbor's car, unless of course, somebody claims an exemption.

[traffic school]

I certainly agree on tax cuts across the board howver what I would like to know is more about the electric cars.

How much electricity does it take to charge them?... And then form what source is the electricity coming from?

Otherwise for the state of fossil fuels we could just be going around in circles!

Regards, Travis.

[Ewan Pritchard]

The non-existence of plug-in hybrids is based on the current premium of about $13,000 per vehicle - for a conversion kit. Manufacturers have to see some financial driver to jump in, and once volumes are seen, the premium is 4-6k over todays hybrid. As for the savings, you can expect to pay about 70¢ per gallon equivalent for the electricity, and where is comes from depends on where you live and whether you opt to purchase renewable energy - here in North Carolina I can fill up with zero emission renewable energy for about $1.00 or so per gallon - not too shabby. I don't even have that option at the gas pump (zero emission gasoline), not to mention the domestic electric power versus war-torn foreign oil. Typical electricity is about 60% coal and will produce about 30% lower emissions than your car - there are tons of other benefits but they may be too confusing to describe.

Thanks,
Ewan