Many EVs to lose big tax credit with new rules by US Treasury Dept

Fewer new electric vehicles will qualify for a full USD 7,500 federal tax credit later this year, and many will get only half that, under rules proposed on Friday by the US Treasury Department.

The rules, required under last year's Inflation Reduction Act, are likely to slow consumer acceptance of electric vehicles and could delay President Joe Biden's ambitious goal that half of new passenger vehicles sold in the US run on electricity by 2030.

The new rules take effect April 18 and are aimed at reducing US dependence on China and other countries for battery supply chains for electric vehicles.

Electric vehicles now cost an average of more than USD 58,000, according to Kelley Blue Book, a price that's beyond the reach of many US households.

The tax credits are designed to bring prices down and attract more buyers. But USD 3,750, half the full credit, may not be enough to entice them away from less-costly gasoline-powered vehicles.

Biden administration officials concede that fewer