Back in 1998, the state of Georgia began a brand-new tax policy designed to encourage more people to get behind the wheel of an electric car. In operation for more than sixteen years, the policy — a generous $5,000 income-tax credit for anyone buying a zero-emission car — helped Georgia become an unexpected champion of the electric car revolution.
Last year, after many failed attempts by various legislators opposed to that tax credit, one legislator sneakily attached new legislation to a new transportation bill which not only killed the $5,000 tax credit for those buying a new electric car but also implemented a new $200 annual registration fee for electric cars, a fee which was more than the state gasoline tax paid by 25-mpg gasoline vehicle covering around 15,000 miles per year. At the same time, the Peach State enacted a brand-new tax break for employees of Mercedes-Benz, exempting them from paying the state’s standard company car tax as a way of ensuring the company — which had just relocated its U.S. headquarters to Atlanta — would keep its operations in Georgia.
As a consequence of the new electric car tax and loss of tax-incentives, new electric car registrations in Georgia have plummeted since the bills were signed into law last spring. But as our friends at GreenCarReports note, a new bill entering into the state legislature could halt that decline in electric car registrations and make electric cars a more appealing proposition for Georgians again.
Enter House Bill 878, a bill specifically designed to lower the annual registration fee for alternative-fuelled vehicles to ensure that Georgians aren’t penalized for driving cars with zero tailpipe emissions. Sponsored by Representatives Scott Holcomb (D-Atlanta), John Pezold (R-Fortson), Michael Caldwell (R-Woodstock) Karia Drenner (D-Avondale Estates) and Michele Henson (D-Stone Mountain) and supported by many more, it already has broad bipartisan support despite only recently receiving its first and second readings.
The bill itself is fairly simple in its language: if passed by the legislature into law, it would lower the annual registration fee for electric vehicles from $200 per year to $75 per year from July 1, 2017. Currently, those with an electric car are paying $35 more in tax than those with the average internal combustion engine vehicle per year, but if the law passes, they’ll pay around $90 less.
The important thing to note? While electric car owners would still be worse off than they were under the original $5,000 tax-credit scheme, the new bill would see them paying a more appropriate amount towards the upkeep of the state’s roads while simultaneously benefiting from lower running costs and taxation compared to an internal combustion engined vehicle. More importantly for the state of Georgia, it would be able to continue to collect a registration fee from electric car owners to help pay for road upkeep without being accused of holding those same people to ransom.
But for the more equitable bill to become law, HB-878 has a long path ahead of it, including favorable votes in both the Georgia House and Georgia Senate.
We’ll be watching carefully to see how it fares.
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