Senate Republicans Introduce Bills to Make Electric Vehicles More Expensive.

Recently, two bills have been introduced in the Senate that, if passed, would significantly increase the cost of most electric vehicles. The first bill, sponsored by Senator John Barrasso (R-Wyo.), proposes the elimination of the $7,500 federal tax credit for electric vehicles, while the second bill, backed by Senator Deb Fischer (R-Neb.), would impose a $1,000 tax on the purchase of any new electric vehicle.

Although these moves are not entirely unexpected, their timing is interesting. After taking office, Donald Trump signed executive orders indicating his intention to eliminate the electric vehicle policies of the Biden administration, which he has incorrectly referred to as a “mandate.” However, Congressional action was needed to carry out this elimination, and several Republicans have begun to initiate this process.

Barrasso's bill, dubbed the Eliminating Luxury Incentives for Electric Vehicles (ELITE) Act (S. 541), would not only eliminate the $7,500 tax credit but could also eliminate the federal investment tax credit for electric vehicle charging stations, the $4,000 credit for used electric vehicles, and remove incentives for leased electric vehicles. This bill currently has the support of 14 co-sponsors.

For her part, Fischer's bill, the Fair SHARE Act, would impose a $1,000 fee on each purchase of an electric vehicle. The argument behind this measure is that electric vehicle owners do not contribute to the gasoline taxes that fund the Highway Trust Fund, essential for infrastructure improvements and repairs. This fund is primarily financed by the federal gasoline tax, which has remained unchanged since 1993 and is not adjusted for inflation.

Fischer has argued that “electric vehicles can weigh up to three times more than gasoline cars, which causes more wear and tear on our roads and bridges.” Claims like this reflect concerns about the weight of certain electric vehicles, such as the Ford F-150 Lightning or the Hummer EV, which are notably heavy. For example, the Tesla Model Y, currently the most popular electric vehicle, weighs around 4,300 lbs, which is comparable to the weight of a Toyota Rav4.

It is important to mention that many electric vehicle owners also own gasoline cars, which means they do contribute to fuel taxes for those vehicles. However, several interest groups have criticized what they perceive as an “unfair advantage” for electric vehicle owners. Some states have already imposed annual registration fees, and some are testing mileage-based pricing schemes.

Fischer has stated that the $1,000 tax would be a one-time charge, designed to equal what a gasoline car would pay in fuel taxes over a 10-year period. However, both bills are expected to face opposition from other Republicans, particularly those whose districts have benefited directly from electric vehicle investments under the Biden administration, which include new assembly plants and battery factories. A letter sent to House Speaker Mike Johnson in August 2024 and signed by 18 Republicans warned that “prematurely repealing energy tax credits… would undermine private investments and halt ongoing developments.” The signatories represent states with high levels of clean energy investments thanks to the Inflation Reduction Act.

Despite the complications, it seems that the tax credit for electric vehicles faces an uncertain future this year, as Trump has made it clear that any electric vehicle-related policies will be dismissed.