Manchin urging Treasury to pause implementation of commercial EV tax credits

U.S. Sen. Joe Manchin (D-WV) is urging the U.S. Department of the Treasury to pause the implementation of the 45W commercial vehicle and 30D new consumer vehicle tax credits.

Manchin, chair of the Senate Energy and Natural Resources Committee, asked for a pause until the Treasury is able to issue guidance in line with the intent of the Inflation Reduction Act (IRA).

The Inflation Reduction Act of 2022 modified tax credits for electric vehicles (EVs) and fuel cell vehicles. Specifically, it enacted new tax credits for used and commercial clean vehicles. Many EVs purchased before Aug. 16, 2022, qualify for a tax credit of up to $7,500. For vehicles purchased after Aug. 16, 2022, only vehicles for which final assembly occurred in North America qualify.

“The intent of the Inflation Reduction Act was clear — bring our energy and manufacturing supply chains onshore to protect our national security, reduce our dependence on foreign adversaries and create jobs right here in the United States. The information released today from the Treasury Department outlining how they will be implementing the commercial and consumer EV tax credits bends to the desires of the companies looking for loopholes and is clearly inconsistent with the intent of the law. It only serves to weaken our ability to become a more energy secure nation. It is unthinkable that we still depend on China and Russia for the materials and manufacturing necessary to power our nation in the 21st century, and I cannot fathom why the Biden Administration would issue guidelines that would ensure we continue on this path,” Manchin said.

Manchin points out that the Treasury Department has known since August that it needed to release proposed guidance on the battery material and components of the Clean Vehicle Credit by the end of this year.

“Instead, Treasury decided they will ignore this deadline and issue proposed guidance in March. In the meantime, they have decided to move forward on implementing these credits without the necessary guidance to ensure taxpayer dollars are being responsibly used. This is an unacceptable outcome, and I call on Treasury to pause the implementation of both commercial and new consumer EV tax credits until they have issued the appropriate guidance. In addition to calling for this pause on the implementation of these credits, when Congress returns to session in the coming weeks, I will introduce legislation that further clarifies the original intent of the law and prevents this dangerous interpretation from Treasury from moving forward,” Manchin added.