Obama Wants $7,500 Tax Credit Changed to Rebate

1-26-11 Greenfield Ener1 1

You might have heard it during the State of the Union address Tuesday night, but President Barack Obama's wanting 1 million electric vehicles on the road by 2015 is more than just a talking point.

Today, the White House released a plan to achieve this goal, and at the top of the list is a giant incentive for prospective EV buyers. The Obama administration wants to turn the current $7,500 EV tax credit into a straight-up $7,500 rebate you get at the point of purchase. That would drastically alter the confusion around how the current tax credit is applied.

This new proposal would be a rebate, similar to how Cash for Clunkers worked. With this plan in place, a 2011 Chevrolet Volt would cost $32,780 (not $40,280), and a 2011 Nissan Leaf would cost $25,280 (not $32,780). It’s much more favorable and straightforward.

Under the plan, consumers would immediately get the rebate, but the dealerships would still file a tax credit claim, similar to the way the electric vehicle leasing systems works – the credit is automatically applied to the lease by the automaker.

Congressional lawmakers are also debating lifting the current 200,000-car limit per automaker to 500,000 per automaker, according to the Detroit News.

The plan contains other elements, such as increasing community grants and research and development for EVs, all of which would still need to be enacted by a new and more contentious Congress.

What do you think? Do we need a Cash for EVs program in the U.S.?



Legitimate market demand should drive what cars are produced, not tax-funded federal subsidies handed out by politicians.

Amuro Ray

I really want this to happen, but not in the current state of gov't.



Look into history. Without initial government subsidies, almost every industry today wouldn't exist.

Amuro Ray

@ Dan,

Although I do agree with you, and that $ is really needed - but where do we get the $ when our gov't's completely beyond broke?

- Raising taxes (so that a few can benefit)?
- Redistribute funding from other programs (that's going to be SUPER easy with our politicians!)?
- Keep on borrowing?

I actually like the tax credit as of now (I like the rebate better) only 'coz people who can afford these vehicles will be eligible for the credit. Not only that, you MUST fall under a specific category with filing your taxes before you can get them, so it's not a guarantee. Interestingly, a lot of rich people do NOT qualify for the credit due to the way they file taxes (in order to avoid paying any tax!). Thus, the "damage" that the tax credit will do is not as significant as one may think.

When our gov't is as rich as China or India, or even close to their level of wealthiness, then switch it to a rebate!


It's a rebate that will go into the pockets of the automakers unless you finance the whole thing and take the rebate yourself. The latter is less likely to happen.


this amount is a drop in the bucket. To pretend that not doing this would somehow make or break the budget is absurd. This is chump change in a $3 trillion federal budget and its the only way to drastically increase acceptance of electric cars.

Ken L.

While there are many pros and cons to this. Yes, I agree that a $7500 rebate is the way to go; it will truly get the ball moving in the direction that this administration has proposed.


Creating this rebate would be a good first step, but doesn't go far enough. The people who buy EVs and Plug in hybrids like the volt are true patriots and need to be rewarded each year they own the car with an additional $750 oil avoidance tax credit. It's time we broke OPECs grip on our nation and stop the flow of dollars to our enemies.


Last November America made it clear that they don't care what Obama has to say. Unless we are talking about teleprompter's Obama needs to shut his pie hole.

Amuro Ray

No one has yet to say "where" this money - $3,750,000,000 (that's $3.75 billion) to be exact - is going to come from? Santa Claus? Again from China? What are we gonna pawn this time?

Current deficit is $14 Trillion...


*sigh* A drop in the budget...please, begone, you digital ink waster. *sigh*

Your Average Democrat

You mean Santa Claus doesn't provide the funding!?


Obummer does not mention where to get the job to afford the expensive piece of crap can barely pay my electric bill in summer too stay cool let alone charge a car every 100 miles. I drive motorcycle and get 40 to 50 mpg driving 0 to 150 mph

Derrick G

I say increase the gas guzzler tax and raise the MPG where it hits instead. Someone driving a 9 MPG car is making a bigger environmental impact and oil demand impact than someone driving a Leaf instead of a Prius or even Elantra.

Amuro Ray

Raising the gas guzzler tax would be sthg that I "kinda" agree (ok, wholeheartedly agree), but there is a serious consequence which will make this not a viable solution: politics.

Domestics manufacturers rely on gas guzzlers too much. Financial markets look at profit short term in the US. Unions want a lot of money. Blah blah blah -> push back from lobbyists and various groups. Both Donkeys and Elephants support the push back from various (but opposite) angles. So...?

No go.



No, just increase the regular gas tax instead. The auto market does not need yet another behavior distorting incentive that favors certain cars over others. Why favor EV vehicles over hybrids or small cars for example. Is it not the MPG that count in the end, not the type of car? Why should the government pick winners?

If you increase the gas tax enough the incentives to buy EV will naturally emerge from the gas savings.

Look what government incentives have done to ethanol. What a nightmare...


Okay...let's see here. I just bought a CPO BMW 328i for $18k and it gets almost 30 mpg. Not only do I have an excellent vehicle IMO that gets good mileage; I can buy a lot of gas for $27k that I saved over the Volt (which I was seriously considering).I guess the Volt (or any electric car)is good if you are looking to minimize your impact on the environment, but I just wanted a nice car with great gas mileage that wasn't a Camry or an Accord. A used car over a new one may not be for everyone, but I feel I got the most bang for the buck. I would like an electric car one day, but the value doesn't seem to be there.

Amuro Ray

Increasing gas tax is also a good, but novelty idea...you see, people who are in the middle to the poor class may not be able to afford the best gas efficient vehicle, or even a new vehicle. They can afford what they have money to buy...then we (by imposing a more expensive gas tax) penalize them and make their lives even harder! Even if they want to buy a green vehicle, the cost is just out of their reach even with the rebate!

An increased gas tax will also raise logistics cost, hence an increase in price on almost all commodities. Now why do the rest of the population have to suffer for the benefit of those who can afford a green vehicle through this rebate?

Both donkey and elephant will reject this idea for the same reason.



Definitely go with the rebate vice the tax credit. I hope both the donks & phants make the correct call.


$7500 rebate? nice start but double it to $15000

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