Sponsors (3)
The bill reduces tax complexity by eliminating the federal clean vehicle tax credit, but it does so at the cost of higher consumer costs for clean vehicles and potential negative impacts on auto-sector sales and jobs.
Taxpayers and tax preparers face simpler tax rules because the bill removes the federal clean vehicle tax credit and related credit interactions, reducing compliance burden and audit complexity.
People buying qualifying clean vehicles (prospective EV/clean vehicle buyers) will no longer be eligible for the federal clean vehicle tax credit for vehicles placed in service after enactment, increasing out-of-pocket costs and making these vehicles less affordable, especially for middle-class families.
Automakers, dealers, and related workers lose a demand-supporting incentive, which could slow EV/clean-vehicle sales, reduce dealer revenues, and harm jobs and small businesses in the auto sector.
Taxpayers and preparers may face short-term transition and filing complications for credits claimed during the carve-out year, creating administrative uncertainty despite the bill’s longer-term simplification goals.
Based on analysis of 2 sections of legislative text.
Repeals the federal clean vehicle (electric vehicle) tax credit (IRC §30D) and makes conforming Code and Title 23 adjustments.
Official title: To amend the Internal Revenue Code of 1986 to repeal the clean vehicle credit.
Introduced April 1, 2025 by Tom McClintock · Last progress April 1, 2025
Repeals the federal clean vehicle tax credit by removing section 30D of the Internal Revenue Code and making related technical changes across the tax code and one change in Title 23 U.S.C. The repeal takes effect for vehicles placed in service in calendar years beginning after the date of enactment, and statutory cross-references throughout the Code are adjusted accordingly.