Say goodbye to the federal electric vehicle tax credit

Thinking of an electric vehicle? Tuesday is the last day before federal tax credits end, or you’ll have to pay full price.

The $7,500 tax credit for new electric vehicles and $4,000 credit for used electric vehicles (EV) ends Sept. 30. Steven Hershkowitz is the managing director for clean transportation for the Washington Department of Commerce. He expects the loss of this incentive will hurt EV sales in the short term.

“There is going to be a bit of a drag on the growth rate that we have seen,” Hershkowitz said. “We’ve already seen the market growth slow down in 2024 and into 2025.

Washington got rid of its tax exemption for EVs earlier this year. The legislature and Governor Ferguson are deciding to use those dollars elsewhere, but Herskowitz said the state’s commitment to electric vehicles and clean energy isn’t going away.

“The commitment is still there, and the prioritization is still there,” Herskowitz said. “These consumer-facing incentives that were quite popular are not, unfortunately, but there’s progress being made in terms of making sure that, hopefully, we can get the incentives back at some point.”

Climate Commitment Act to fund clean energy projects

The state will continue to use funds from the Climate Commitment Act to push clean energy and expand EV charging around the state.

Herskowitz believes electric vehicles are the future, and the demand will eventually return.

“The automakers know that this is where it’s going,” he said. “The global competition is further ahead in many major markets now internationally for EVs, and so this is where we’re going. It’s just about the pace at which we get there.”

The pace also includes finding ways to improve the pricing for electric vehicles.

The average price for a new EV is over $55,000. The average price for a new gas car is $49,000. You can certainly find new EVs for much less. Some only run about $30,000.

Now might be the time to get in, if you want to take advantage of the tax credit.

“It’s a good opportunity for people who have been considering getting an electric vehicle to really bring that consideration up to a higher level, perhaps go into dealerships, test drive, see what the prices are,” Herskowitz said. “This could be a good opportunity to get deals depending on which model you’re looking at.”

But expect a lot of company. You won’t be the only person trying to squeeze in before the deadline.

To take advantage of the tax credit, you only need to have ordered an EV by the deadline. You can take delivery later and still get it.

Chris Sullivan is a traffic reporter for KIRO Newsradio. Read more of his stories here. Follow KIRO Newsradio traffic on X.

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