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EV Tax Savings Tabulated

U.S. says $1 billion-plus saved by buyers since the new year, tallies lifetime savings versus gas-powered ownership.

June 12, 2024
EV Tax Savings Tabulated

Transferring credits to the auto dealer, essentially giving buyers a down payment rather than the consumer waiting to get the money back at tax time, has been popular.

Credit:

Pexels/Dids

2 min to read


More than $1 billion in federal tax credits have gone to electric-vehicle buyers across over 150,000 sales this year so far, the U.S. treasury department said.

It said the EV sales volume means buyers save $1,750 on average per year on fuel and maintenance, or $21,000 in a typical 15-year vehicle lifetime, compared to costs for a gas-powered vehicle.

The point-of-sale credits are intended to encourage EV sales as a way to reduce polluting emissions. Qualifications for the tax breaks had been restricted since Jan. 1 to vehicles whose materials aren’t sourced from “foreign entities of concern,” in particular China, which has a corner on certain EV battery materials. But this spring, the treasury department delayed enforcement of the restrictions to 2027.

“This discount is increasing consumer choices and creating new opportunities for companies to expand their customer base,” said treasury secretary Janet Yellen in a press release on the cumulative consumer savings this year.

The credits can help bridge the gap between higher prices of EVs compared to gas-powered models.

Transferring them to the auto dealer, essentially giving buyers a down payment rather than the consumer waiting to get the money back at tax time, has been popular, according to the department, which says 90% of those who’ve bought new EVs and 80% who’ve bought used models have opted for that method.

LEARN MORE: EVs Get More Affordable

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