South Korea doesn’t like the US Inflation Law
2022.12.07 01:45
South Korea doesn’t like the US Inflation Law
Budrigannews.com – The Biden administration is being urged to take advantage of a commercial electric vehicle tax credit to increase consumer access to EVs. This plan could help alleviate concerns regarding a climate bill that was approved by Congress. It is supported by numerous automakers as well as the government of South Korea.
The $7,500 consumer tax credits for electric vehicles built outside of North America were eliminated by the $430 billion U.S. Inflation Reduction Act (IRA) in August, which angered South Korea, the European Union, Japan, and others.
A lesser-known IRA provision for “commercial clean vehicles,” according to some automakers, could be used to boost EV manufacturers and address foreign concerns.
Among others, Rivian Automotive, Hyundai Motor, and Kia Corp. want the government to allow consumer vehicle leasing to be eligible for the commercial EV tax credit, which could lower lease payments.
In remarks made public on Tuesday, the South Korean government urged the Treasury to “interpret commercial clean vehicles broadly” to include Uber-owned, leased, and rental vehicles. or Lyft (NYSE: fleets of rideshares.
Additionally, South Korea requested that Treasury not impose any budget restrictions on tax credits for commercial vehicles until 2025.
Hyundai and Kia want the Treasury to allow leaseholders of electric vehicles to qualify for a $4,000 tax credit toward the purchase of a used electric vehicle when leases are up.
The IRA consumer EV tax credit seeks to phase out Chinese battery minerals or components, imposes significant restrictions on the sourcing of battery minerals and component, and establishes income and price caps for qualifying vehicles.
The commercial credit has a more complicated “incremental cost” eligibility test, but it does not have the same pricing or sourcing restrictions. Treasury should make it simpler for most commercial light-duty vehicles to be eligible for $7,500 in tax credits, according to some automakers.
“There are tweaks that we can make that can fundamentally make it easier for European countries to participate,” President Joe Biden stated last week.
The use of commercial credit for consumer sales is opposed by some automakers.
Toyota Motor Corporation “The lack of criteria to qualify for (commercial credits) could undermine the IRA’s goals to expand domestic production of EV batteries and maintain America’s energy independence,” Corp stated.
NASDAQ: Tesla said that consumer tax credits and commercial credits “should apply exclusively for individual end-users” and “should apply exclusively for commercial end-users.”
(NYSE:) General Motors On the sidelines of an event on Monday, Chief Executive Mary Barra told Reuters that “sticking to the intent of the bill” drafted by Congress “is important” and that addressing foreign concerns about the credit is “more complicated than just one thing to solve it.”
