The state of California will offer tax rebates for electric vehicle purchases if President-elect Donald Trump’s administration eliminates a federal EV tax credit as he has threatened to do, California governor Gavin Newsom said on Monday.
“Consumers continue to prove the skeptics wrong – zero-emission vehicles are here to stay,” Newsom said in a statement. “We will intervene if the Trump Administration eliminates the federal tax credit, doubling down on our commitment to clean air and green jobs in California. We’re not turning back on a clean transportation future — we’re going to make it more affordable for people to drive vehicles that don’t pollute.”
Money for the program “could come from the Greenhouse Gas Reduction Fund, which is funded by polluters under the state’s cap-and-trade program,” Newsom added.
Although Trump could not eliminate EV tax credits on his own, Congress could erase the credits by amending the Inflation Reduction Act of 2022 or passing a new law.
Already, incoming members of Trump’s administration, and the president-elect himself, have expressed willingness to cut back EV tax credits. Trump, however, said in August that he wasn’t ready then to make “any final decisions on it.”
“I’m a big fan of electric cars,” he said, “but I’m a fan of gasoline-propelled cars, and also hybrids and whatever else happens to come along.”
“[Republicans are] going to move fairly quickly, I’m told,” Thomas J. Pyle, president of the conservative energy research group American Energy Alliance told the New York Times earlier this month.
“President Biden set the precedent for this,” Pyle said. “There’s nothing the Democrats can do or say about that. The question is how unified the Republicans will be, and I suspect they would be in the beginning to give Donald Trump his honeymoon.”
The federal tax credits can run as high as $7,500 per car or truck. In 2020, Newsom mandated that all new car sales in California must be zero-emission vehicles by 2035, meaning the state will ban the sale of new gasoline-powered vehicles.
California’s state legislature would have to vote to start the rebate program. Newsom is expected to offer more details about the program, including how much it would cost, this week.