Senate Bill Proposed to Change Electric Vehicle Tax Credit into Instant Rebate

Online, April 7, 2011 (Newswire.com) - The federal government will soon be considering a Senate bill that would change the current $7500 electric vehicle tax credit into a $7500 instant rebate for all green vehicles.
This change can be found not only in President Barack Obama's budget but also a bill proposed by Senator Debbie Stabenow, Michigan Democrat.

Edmunds.com, a 45 year old trade magazine company that provides automotive information, posted a Department of Energy document listing the department's funding highlights. The proposed Obama Budget, changes the existing $7,500 electric vehicle tax credit "into a rebate that will be available to all consumers immediately at the point of sale."

Known as the "Charging America Forward Act (s.298) the proposed legislation will provide consumers with a rebate worth up to $7500 for plug-in electric vehicles at the time of purchase.

As it stands today, if one were to buy a $41,000 Chevy Volt, the buyer gets a $7,500 coupon, so the final price is $33,500. In the end, the auto dealer assumes the risk of the government giving them this tax credit.

In response, the Department of Energy's David Sandalow told Bloomberg News in February the insta-credit would operate the "same way the 2009 'Cash for Clunkers' program worked."

The Detroit News reported Vice President Joe Biden said at an Indiana battery assembly plant, "You won't have to wait,' it would be like the cash-for-clunkers program."

Is the United States really prepared to deal with another tax payer paid for deal? After all, did Cash for Clunkers part one really work out for the tax payers and auto dealers? Washington, D.C. based organization Americans for Tax Reform didn't think so. The unseen costs and the fact that consumer spending did not increase creates a difficult environment for the proposed changes.

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