Change Ahead for Georgia's EV Tax Credit
There's a reason why the state of Georgia and the city of Atlanta, in particular, have vaulted to the Number Two position in the United States for electric car sales. In 1998, the state passed a $5,000 state tax credit just as some of the first generation of modern electric vehicles were being introduced; vehicles like the Ford Ranger EV, Toyota RAV4 EV, and the GM EV1, all of which saw limited deployment in the state, mainly with Georgia Power.
The shelving of the Zero Emission Mandate in California spurred a mass recall of most of the electric cars and pickups that had been leased at that point. Effectively, the supply of electric vehicles simply dried up, not to be resurrected until the introductions of the Chevrolet Volt and Nissan LEAF in late 2010, early 2011. Because the original bill hadn't envisioned electric hybrids like the Volt, only the all-electric LEAF qualified for the credit. That year the total credits applied for was mere $310,000.
By 2013, this had exploded to $15.4 million, as thousands of Greater Atlanta residents took advantage of both the states' $5K credit, along with the federal government's $7,5000 credit: the combination of which made the purchase or lease of the LEAF, especially, a compelling economic argument. [See "When Lawyers Go Electric"].
Of course, no good thing lasts forever. State lawmakers started talking about ways to either eliminate or modify the law. There are now three bills before the legislature: one which would do away with the credit all together as early as this July. The other two bills would modify the measure, allowing for its eventually phase out, as well as allowing credits to be applied to electric hybrids like the Volt.
While Georgia residents are likely to see their state's EV tax credit phased out, it could turn out the total amount they would be allowed to deduct may, in fact, change very little if President Obama's proposed $10,000 point-of-sale rebate, which is part of his 2015 budget request, is passed by Congress. Unlike the previous tax credit, which requires the car buyer to wait until the following year to see any financial benefit, the Administration wants to make the reward more immediate at the time of the sale. This not only makes the cars more affordable, but allows more people to benefit who may not owe $10,000 or more in federal taxes.
The measure would also remove the current 200,000 vehicle cap on the $7,500 credit. It would be phased out by 2022.
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Developed in collaboration with Nanyang Technological University and Germany’s Technische Universitat Munchen (TUM), it is billed as the first developed for humid Asian climates.
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