U.S. House Democrats propose EV tax credits of up to $12,500 By Reuters

© Reuters. FILE PHOTO: Computer science professor Christa Lopes’ Scion IQ electric car is plugged in in her garage in Irvine, California January 26, 2015. REUTERS/Lucy Nicholson

WASHINGTON (Reuters) – U.S. Democratic lawmakers late Friday proposed boosting tax credits for electric vehicles to up to $12,500 per vehicle for union-made zero emission models assembled in the United States.

The House Ways and Means Committee will vote on Tuesday on the proposal which is a part of a broad tax measure in a planned $3.5 trillion spending bill.

The bill would make General Motors Co (NYSE:) and Tesla (NASDAQ:) Inc eligible again for EV tax credits after they previously hit a cap on the existing $7,500 incentive. It would also create a new smaller credit for used EVs.

The bill would make most electric vehicles eligible for a $7,500 tax credit and then give automakers who assembled vehicles with union labor in the United States an additional $4,500 tax credit and $500 for vehicles meeting U.S. domestic content requirements, including having battery cells manufactured in the United States.

The proposal to give union-made vehicles higher credit has already drawn criticism from foreign automakers like Honda Motor Co.

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