EV development to be boosted by sustained tax credits
Under the proposal, tax credits for electric vehicles (EVs) would remain at the current level of up to $7,500 for each new vehicle purchased and $4,500 for a second-hand EV. This will continue to spur EV adoption in the country. Nevertheless, these tax credits are granted with the conditions that the minerals used to produce EVs will need to be produced in the US or a country with whom the US is a free trade partner; batteries in EVs should also have a significant share of components that are produced in North America. This will help build a stronger domestic supply chain, but it could take time before a mature supply chain takes shape.
Additionally, as opposed to a Build Back Better rule that EVs would no longer be eligible for credits if a manufacturer had already sold 200,000 cars, the Inflation Reduction Act would…