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President Obama Proposes Higher Tax Credits For Alternative-Fuel Vehicles

Mar 27, 2012

President Barack Obama recently proposed expanded tax credits and community research grants to make alternative-energy cars and trucks more attractive to buyers. Electric, natural gas and hydrogen-powered vehicles would be covered by the plan. The President asked Congress to make two changes to the federal tax law:¨ Raise the tax credit from $7,500 to $10,000 for the purchase of an “advanced vehicle.”¨ Provide a 50% tax credit for half the additional cost of an electric or natural gas-powered commercial truck, including semi-tractor trailers, over a conventional truck. The President’s proposal comes at a time when many automakers are struggling to sell alternative fuel vehicles. Proponents of the proposal say that increased investment in alternative fuel technologies will help the Country reduce the amount of oil we use. As demand lowers, prices come down. The commercial truck tax credit is aimed at trying to increase the fuel efficiency of 18-wheel trucks by 50 percent by 2015. According to the White House, 18-wheel trucks represent four percent of the on-road vehicles in the U.S., but account for almost 20 percent of the nation’s fuel consumption. The President also proposed a new, $1 billion program to as many as 15 U.S. cities to finance investments in clean-vehicle infrastructure, such as charging stations.