In a single stroke of the pen, President Joe Biden eliminated the eligibility of approximately 70 per cent of EVs for tax breaks.
The Inflation Reduction Act changed which vehicles could qualify for the Clean Vehicle Credit.
With the new changes, vehicles must be assembled in North America, and the manufacturer has a 200,000 EV credit limit.
As per the Alliance for Automotive Innovation, the change to Clean Vehicle Credit removed 72 previously eligible models.
The biggest hit is those who assemble their EVs outside North America, including Toyota, Hyundai, Porsche and Kia.
However, it does appear that there are still around 20 models that qualify.
From the 2022 model year, these vehicles are:
- Audi Q5
- BMW 3 Series Plug-In and BMW X5
- Chrysler Pacifica PHEV
- Ford F series, Ford Mustang Mach E, Ford Transit van
- Jeep Grand Cherokee PHEV
- Jeep Wrangler PHEV
- Lincoln Aviator PHEV and Lincoln Corsair plug-in
- Lucid air
- Nissan Leaf
- Rivian EDV, Rivian R1S, Rivian R1T
- Volvo S60
From the 2023 model year, the following vehicles are eligible:
- BMW 3 Series Plugin
- Mercedes EQS
- Nissan Leaf
The Clean Vehicle Credit will also change a little more starting January 1, 2023.
The changes will include restrictions on the purchase of batteries and minerals.
In addition, there will be price and income limits, much like the BC provincial tax break for EV purchases