Last year's Inflation Reduction Act provided a federal tax credit of up to $7,500 to use toward an EV. Under the rules, a dealer can apply that credit to any leased electric vehicle, no matter where it's made, to reduce a customer's monthly payment.For buyers, only EVs made in North America qualify for the full tax credit. And only 10 of the 49 electric vehicles for sale in the United States this year meet that requirement.
"It definitely makes sense," he said."Incentives can move the market if that narrows the affordability issue between gas and electric cars." Sen. Joe Manchin, a West Virginia Democrat and a key author of the tax-credit language, wanted the North American manufacturing requirement to help boost U.S. manufacturing jobs. He included the battery requirements to incentivize companies to build a domestic EV supply chain. But Manchin says the Biden administration is circumventing the law's intent by allowing tax credits for vehicles manufactured overseas.
"Eligibility for the commercial vehicle credit is a straightforward reading of the Inflation Reduction Act as written by Congress and application of longstanding tax law regarding leased assets," Ashley Schapitl, a spokeswoman, wrote in a statement."There was no room for Treasury interpretation."