Elon Musk Thinks Tesla Was Unfairly Attacked in the New Infrastructure Bill
Andrew Koole
· 4 min read
If you’re in the market for an electric vehicle, the Democrats’ new
infrastructure bill
could be good news. The bill, which is now in front of the House Ways and Means Committee, would continue to fund a $7,500 tax credit for EV purchases. If passed, the bill would also potentially boost the credit by $4,500. But to access the additional cash, consumers will have to jump through a couple of hoops—it would only be available if the EV was built in the U.S. and by union labor.
The stipulations on the increased tax credit have ruffled a few feathers in the industry, including those of
Tesla
CEO Elon Musk. The EV tycoon says the credit boost unfairly excludes automakers like Tesla whose workforces aren’t unionized. 
How would the new EV tax credit work?
The infrastructure bill working its way through Congress keeps the current EV tax credit in place and actually reinstates it for automakers who were
phased out
of the program. Car and Driver
says the original tax credit decreased based on each company’s total EV sales from 2010 on. Tesla and General Motors (GM) had already reached their credit limits, but CNET
says the new bill does away with the cap altogether.It also offers an additional $4,500 for vehicles built in America by union labor as well as a $500 credit if the vehicle’s battery was built in the U.S.
The whole tax credit is non-refundable, meaning it can only be applied to taxes owed after filing. It cannot be added to a tax return and does not come in the form of a refund.
What does Elon Musk not like about the new tax credit?
From the outside, it would seem that electric-carmakers should be jumping for joy at the news of a government program specifically designed to increase access to the product they produce. But not every EV developer is amused by the changes made to the tax credit.
Tesla’s Elon Musk went to Twitter after the bill’s details were announced, complaining that the $4,500 seemed to benefit one manufacturer—namely,
Ford
. "This is written by Ford/UAW lobbyists, as they make their electric car in Mexico,” he said. “Not obvious how this serves American taxpayers."
Musk wasn’t alone in his criticism of the new plan.
Toyota
also spoke out against the tax credit boost benefiting union workers, saying the extra $4,500 would only benefit the wealthiest of consumers. How do consumers access EV tax credits?
If the infrastructure bill passes, the EV tax credit will offer up to $12,500 per vehicle and applies to any new, non-commercial electric vehicle built by a manufacturer. But that doesn’t mean all EV drivers will be able to access it.
To be eligible, you’ll need to actually own your EV. Leases do not apply. And, to make sure the tax credit ends up in the hands of consumers, the electric vehicle cannot be intended for resale and must be driven primarily in the U.S. You also need to owe taxes for it to be deducted from.
There are other ways that electric car drivers can save. No matter what your tax bracket, EV owners can access
car insurance
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