Manchin Introduces Bill to Defer Tax Relief for Electric Vehicles

WASHINGTON (AP) – Increasing his criticism of the Biden administration, Democratic Senator Joe Manchin on Wednesday proposed deferring new tax credits for electric vehicles, a key feature of President Joe Biden’s landmark climate bill.

Manchin said guidelines issued by the Treasury allow manufacturers in Europe and elsewhere to bypass requirements that a significant proportion of electric vehicle batteries must be made in North America.

The climate law, officially known as the Inflation Reduction Act, “is first and foremost an energy security bill,” Manchin said, adding that “tax credits for electric vehicles were designed to increase domestic production and reduce our dependence on overseas supply chains for critical important.” minerals needed for the production of batteries for electric vehicles.

Manchin’s bill comes as Energy Secretary Jennifer Granholm and White House climate adviser Ali Zaidi are set to attend the Washington Auto Show on Wednesday to highlight the Biden administration’s efforts to develop electric vehicles and related infrastructure.

The White House on Wednesday declined to comment on Manchin’s bill, but the West Virginia lawmaker’s measure is unlikely to find support in the narrowly divided Senate, where Democrats have a narrow majority. During the midterm campaign, Republicans criticized Biden and other Democrats for supporting electric vehicles, citing their relative high cost and batteries currently made in China.

Tax credits of up to $7,500 per vehicle are designed to boost electric vehicle sales and domestic vehicle and battery production while reducing planet-warming greenhouse gas emissions. European and Asian allies, including French President Emmanuel Macron, have criticized the rules as unfair to foreign manufacturers.

While Macron hailed Biden’s efforts to curb climate change, he said during a visit to Washington that the subsidies in the new law could be a huge setback for European companies.

Biden acknowledged “failures” in the legislation but said “we can amend” to please allies.

Manchin’s bill follows the Treasury Department’s decision to delay battery and mineral content regulations until March, while the rest of the program will be implemented on January 1. The Manchin bill directs the Treasury Department to stop issuing tax credits for vehicles that do not meet battery requirements.

“The United States is the birthplace of Henry Ford, who revolutionized the automotive industry,” Manchin said, calling it “shameful that we rely so heavily on foreign suppliers, especially China, for the batteries that power our electric vehicles.”

The Department of Energy said sales of electric vehicles have tripled since Biden, a Democrat, took office two years ago, and there are now more than 2 million electric vehicles and 100,000 chargers on US roads. The Climate Act, along with the 2021 Infrastructure Act and other changes, “mobilizes public and private sector investment to revitalize domestic manufacturing, expand electric vehicle charging options, and reduce transportation costs for American consumers,” the agency said in a statement.

Manchin, chairman of the Senate Energy and Natural Resources Committee, played a critical role in passing the climate bill, which was passed without the backing of a single Republican. He said incentives approved by the Treasury Department, including those that allow tax breaks for electric vehicles purchased for commercial use, such as leasing or sharing, even if they are made overseas, undermine the law’s intent to reduce U.S. dependence on foreign adversaries. and create jobs in the US.