Tesla's Model 3 sedans are now eligible for the full $7,500 US tax credit under new battery-sourcing criteria set by the US Treasury Department. This change is part of the Biden administration's plan to encourage and promote adoption of electric vehicles. The update, released on the Environmental Protection Agency website on Tuesday, brings the total number of electric vehicle models qualifying for the full tax credit to 22, including those from General Motors Co., Ford Motor Co., and Volkswagen AG.
Previously, only the performance version of the Model 3 qualified for $7,500 in tax credits. But with the new criteria set by the Treasury Department, all Tesla Model 3 vehicles are now eligible for the full tax credit. This includes the long-range Model 3, which Tesla recently began selling again, and was previously only eligible for $3,750 in federal tax credits.
This new development is a significant boost for Tesla, as their Model S and Model X vehicles still do not qualify for any tax credit. However, with more consumers beginning to shift towards electric vehicles, this could incentivize them to consider purchasing a Tesla Model 3, saving them money in the long run.
Overall, the expansion of the full tax credit to all Tesla Model 3 vehicles, as well as other electric vehicle models, is a positive step towards encouraging the adoption of electric vehicles and a reduction in carbon emissions.