Senate Bill Decimates EV Tax Credit, Fuels Fossil Fuels

A new Senate bill threatens to revoke the electric vehicle tax credit, potentially damaging the burgeoning EV market. This decision, part of a broader tax and budget bill, aligns with the fossil fuel industry’s interests, sparking controversy.

Sudden Tax Credit Elimination

The Senate has modified the budget and tax bill, better known as “Trump’s Big Beautiful Bill.” This bill, which passed the House last month, now aims to terminate the $7,500 tax credit for electric vehicles. This change is expected to be in effect by September 30th.

Yo Elon, is it surprising? Trump and the GOP campaigned on this on your own dime, and now you act surprised? https://t.co/W5QZN0pX8f

— Fred Lambert (@FredericLambert) June 28, 2025

“The US is already significantly behind the rest of the world in terms of EV adoption, and this will only increase this gap.”

— Electrek

As of December 2024, EVs made up nearly 8% of all new car sales in the U.S., showing the growth potential of the market. (Statista)

Financial Fallout

The bill also speeds up the phase-out of incentives for wind, solar, and energy storage projects. The move comes after reports that Trump promised oil executives he would end EV incentives if they provided over $1 billion, which they reportedly did. Even Elon Musk seems taken aback by the turn of events.

This decision to curtail electric vehicle incentives may isolate the U.S. from the global shift towards EVs and could negatively affect the domestic auto industry’s competitiveness. Tesla, whose CEO played a role in this situation, may see financial losses sooner than anticipated.