The US Senate has passed a multitrillion-dollar tax-and-spending package that eliminates tax credits for electric vehicles after September 30. The bill, which needs to be approved by the House of Representatives, aims to end tax breaks for consumers who buy or lease EVs after the deadline.
The credit, worth $7,500 for new EV purchases and $4,000 for used EV purchases, has helped make EVs more affordable and reduce carbon emissions from the transportation sector. According to Ingrid Malmgren, senior policy director at Plug In America, the elimination of the tax credits will have a significant impact on consumers who want to buy an EV.
“The summer of the EV is coming because come the end of September those credits will be gone,” she said. “If you’re interested in driving an EV — either new, used or leased — now is the time to act.”
The bill’s passage was by a narrow margin of 51-50, with Vice President JD Vance casting the tie-breaking vote. The Senate’s timeline for ending the tax credits is more stringent than an initial version of the legislation passed in May by House Republicans.
While some emissions are created when electric cars are built and charged, EVs are “unambiguously better for the climate” than gasoline-powered cars according to researchers at the Massachusetts Institute of Technology. Experts also note that the price gap between new EVs and comparable gas cars is shrinking, making them a more financially viable option.
However, if the federal tax credit disappears, consumers would need to ensure they have the car in hand by September 30 to claim the subsidy. Malmgren recommends consumers opt for the tax break up front at the point of sale instead of claiming it next year on their annual tax return.
Source: https://www.cnbc.com/2025/07/01/trump-big-beautiful-bill-axes-7500-ev-tax-credit-after-september.html