The EV Tax credit is soon to be phased out as Toyota reaches its market cap of 200,000 EV vehicles sold in the United States. For prospective first-time Toyota buyers, this could be bad news if you still have not purchased a plug-in hybrid vehicle from Toyota like the RAV4 Prime or the Prius Prime.
While other automakers like Tesla and GM have reached that market cap, Toyota is still underneath the line. When the phaseout begins, you will no longer be able to qualify for the $7500 tax credit by purchasing an EV or a plug-in hybrid from Toyota.
Starting in 2026, only U.S made EVs will be able to get the tax credit with a base credit of $4500 added. However, only union-negotiated automakers like Stelantis, Ford, and GM will be able to sell with the tax credit.
I personally do not like the EV tax credit. I think it cheats the markets and persuades people to buy EVs just for the sake of a few thousand dollars. After reading the comments on an article published by FOX News and written by the Associated Press, a lot of people do not like these tax credits. To be fair a lot of people who read Fox News don’t like tax credits in general, but they have a great point. “Let the markets decide,” said “cravette,” one of the commenters.
Although I won’t buy an EV just for the sake of a tax credit, I will buy an EV, probably a Toyota -EV within the next few years. With the Toyota RAV4 Plug-in hybrid and the Prius Prime getting more and more anticipated, It might be a good idea to buy one now and still qualify for a tax credit.
On the other hand, if you really are worried about gas prices rising, go ahead and buy one. If I was worried about gas prices, I would probably buy a used hybrid. Even though these used ones won't get you a tax credit, they will still save you a lot on gas.
What do you think? Should the U.S government continue to give incentives for EVs? Should they extend the market cap? Let us know in the comment section below.
Harutiun Hareyan is reporting Toyota news at Torque News. His automotive interests and vast experience test-riding new cars give his stories a sense of authenticity and unique insights. Follow Harutiun on Twitter at @HareyanHarutiun for daily Toyota news.