As governments are under increasing pressure to go green, and the public not yet convinced that plug-in cars are the wave of the future, lawmakers are stepping up the tax incentives for buyers. This is in addition to the huge grants and tax credits that federal and state governments are providing to manufacturers of charging infrastructure.
In the United States, federal laws already allow significant income tax deductions that apply to new vehicles, such as the upcoming Nissan Leaf. According to IRC 30D, purchasers of electric cars are allowed a basic tax deduction of $2,500 and vehicles with larger battery packs can provide tax savings up to $7,500. Those who modify a gas guzzling car into a vehicle capable of operating with electric charge qualify for a tax benefit of $4,000. Overseas in the UK, government grants provide up to £5,000 to buyers of ultra-low carbon hybrids, or plug-ins.
So what about the States?
Depending on the state in which you live, tax incentives can vary wildly. For example, California‘s Clean Vehicle Rebate Project allows rebates up to $5,000 for low-carbon cars and up to $20,000 for commercial trucks.
Washington car buyers are exempt from paying sales taxes on electric and fuel-cell powered cars. Converted cars are eligible for tax credits as well.
The state of Tennessee, choosing to go in an interestingly different direction, is offering free charging equipment to plug-in owners who need to refuel at home. As of now, however, only certain cities are eligible.
Florida provides special financing arrangements for those who wish to install charging equipment on their property. Residents or businesses in the Orlando metropolitan area can apply for free charging equipment from Coulomb Technologies. All electric vehicles are allowed on the High Occupancy Vehicle (HOV) Lane.
To learn more about the wide variety of rebates, grants, and credits that might be offered in your state, the Department of Energy breaks down the laws and tax incentives. As you can see in the table, certain states are way ahead of others (ahem, California) in the subsidizing game… for better or for worse.
These laws are fluid, and they are certainly going to be amended and updated once the plug-in rollout hits full speed. In determining whether to opt for an electric car, price is obviously a major consideration for consumers. Whether it trumps performance, and more importantly, convenience, is another question. It seems, however, that all these considerations are at least being worked on.