GOP wants EV tax credit gone; it would be a disaster for Tesla

The Republican Party’s opposition to tax credits for electric vehicles has stepped up a notch. As its members in the US Senate add their input to the budget bill that came from their colleagues in the House of Representatives, among the changes they want to see is a faster eradication of the IRS clean vehicle tax credit. The tax credit provides up to $7,500 off the price of an EV as long as certain conditions are met, and the language from the House would have given it until the end of the year. Now, it might be gone by the end of September.

The looming passage of the bill appears to have reopened the rift between Tesla CEO Elon Musk and the Republican Party, which the billionaire funded to the tune of hundreds of millions of dollars in the last election. After a brief war of words earlier this month that was quickly smoothed over when Musk apologized to President Trump, it seems there’s the potential for strife again.

Yesterday, Musk once again took to his social media platform to denounce the budget bill, threatening to form a third political party should it pass and reposting content critical of the GOP spending plan.

The changes to the budget would be quite deleterious for Tesla. Although its sales have collapsed in Europe and are flagging in China, the US has remained something of a bulwark in terms of EV sales. Most of the EVs that Tesla offers for sale in the US are eligible for the $7,500 credit, which can be applied to the car’s price immediately at purchase, as long as the buyer meets the income cap. That means all these cars will become significantly more expensive on October 1, should the bill pass.

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