Merkley, Democrats: Tax bill must retain electric-car tax credits

Fourteen Democratic senators, led by Sen. Jeff Merkley of Oregon, urged key tax negotiators Tuesday to prioritize a long-term extension of tax credits for electric and alternative fuel vehicles and infrastructure in an upcoming tax bill.

In a letter to Democratic leaders Chuck Schumer and Nancy Pelosi and ranking members Ron Wyden and Richard Neal, the senators wrote, “We should not allow this credit to expire just as these vehicles are starting to gain a foothold into the market.”

The senators noted that transportation is now the largest sector of greenhouse gas emissions in the United States, recently surpassing the electricity sector. The said this makes it all the more urgent to not cut off tax credits that support the emerging electric and alternative fuels vehicle markets.

“Auto manufacturers require long-term policy certainty to plan and manufacture new vehicle models, and so this approach to these important tax credits would facilitate a responsible transition to a clean transportation future,” the senators concluded.

In addition to Merkley, the letter was signed by senators Sheldon Whitehouse (D-RI), Martin Heinrich (D-NM), Edward J. Markey (D-MA), Kamala Harris (D-CA), Cory Booker (D-NJ), Brian Schatz (D-HI), Michael Bennet (D-CO), Catherine Cortez Masto (D-NV), Patty Murray (D-WA), Dianne Feinstein (D-CA), Elizabeth Warren (D-MA), Chris Murphy (D-CT) and Bernie Sanders (I-VT).

The full text of the letter follows below.

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Dear Leader Schumer, Leader Pelosi, Ranking Member Wyden, and Ranking Member Neal,

As you negotiate a tax extenders package, we would urge you to include an extension of the credits for electric and alternative fuel vehicles and infrastructure (30B, 30C and 30D). These credits have either expired, or will be phasing out for a significant share of the market next year, and so there is an urgent need to extend these credits.

Transportation is now the largest sector of greenhouse gas emissions in the United States, recently surpassing the electricity sector. A rapid transition to electric vehicles and alternative fuel vehicles is therefore necessary to reduce these emissions. Fully electric and alternative fuel vehicles still comprise less than 1% of the U.S. market. We should not allow this credit to expire just as these vehicles are starting to gain a foothold into the market.

We respectfully urge you to include a 10-year extension of the tax credit for alternative fuel vehicles and infrastructure (30B and 30C), and also replace the 200,000 vehicle cap on the tax credit for electric vehicles (30D) with a 10-year sunset provision. Auto manufacturers require long-term policy certainty to plan and manufacture new vehicle models, and so this approach to these important tax credits would facilitate a responsible transition to a clean transportation future.

Sincerely,