If you were thinking of taking advantage of Georgia’s $5,000 tax credit and leasing an Electric Vehicle, (EV) you had better hurry. After June 30th the credit will be no more. Thanks to House Bill 170 (see Section 5-1) lead by State Representative Chuck Martin of Alpharetta, the tax credit will be discontinued at the end of June
Representative Martin’s argument for discontinuing the program is that the people who benefit from the credit are “a narrow group of in-town citizens” who are being supported by Georgia tax payers. He argues that it is unfair “to let a select group of 10,000 or more individuals drive a particular type of car for free or almost free.”
Martin also claims that it is costing $50 million per year to support the 10,000 EV owners.
When I spoke to Representative Martin he told me that the intent of the new bill is to use the $50 million savings for much needed statewide infrastructure improvements for roads and bridges. One mechanism for doing this, he says, could be by redirecting the savings to pay for 20-year bonds that would fund more than a half-billion dollars of improvements. For now, however, the $50 million will rest in the general fund.
A further provision of HB 170 will impose an annual $200 road use fee on EV drivers to offset fuel taxes that are not paid. Martin feels that a use tax is necessary but the amount is excessive. (The average American driver logs 13,500 miles per year. At 26 miles per gallon times the new 29.2 cent excise tax per gallon, the average fossil fuel driver will pay $150 per year. (13,500 / 26 = 519 gallons x 29.2 = $150), that’s $50 less than the non-polluting EVs will be assessed. GH)
The principal argument for having a tax credit is that air quality improves by replacing fossil fueled cars with EVs, and government support for the common good is warranted.
Furthermore, according to the Union for Concerned Scientists, because Georgia has to import all fossil fuels from other states, some of the cost of that fuel ($1.7 billion in 2014) is saved. A study by The Georgia Department of Economic Development (DED) found that the fossil fuel savings per individual EV amounts to over $2,000 per year, or 80% of the tax credit. This savings is reinvested in the Georgia economy.
It is true, as Representative Martin argues, that with the $5,000 tax credit, leasing an EV is close to driving for free, especially when gas prices were hovering around $4.00 per gallon and business trips in an EV are tax deductible. In this regard the question is, should folks who conserve our natural resources and, as a result, save money be penalized over those who waste natural resources by using fossil fuels for their homes and cars?
It is not true that EVs are solely for “a narrow group of in-town citizens” when, statistically, 90 percent of Americans drive fewer than 50 miles a day. Since the range of EVs is over 75 miles, this makes owning or leasing an EV a viable option for most motorists.
Some Good News
There are still federal tax credits of up to $7,500 if you lease or purchase an EV or hybrid car. This amount is deducted from the list price — still a good deal.
For Nissan LEAF owners, Nissan has just announced a $5,000 discount if you purchase your leased car before June 30th. Taking advantage of this offer will mean a total savings of $17,500 on a car that lists for around $29,000.
I asked Victor Akan, the finance manager at Auto Nation Nissan in Lithia Springs, Georgia, what Nissan’s motive for making this offer could possibly be. “It’s simple,” he told me. “Nissan doesn’t want to see great numbers of pre-owned, leased LEAFs ending up on dealers used car lots.”
Our family took advantage of this offer and is now the proud owner of our pre-owned Nissan LEAF
Here is a list of states that still offer incentives for EVs and hybrid electric cars
Source: Alternative Fuels Data Center, Laws & Incentives Database; R.L. Polk National Vehicle Population Profile database, March 31, 2014
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