Ending the tax credit is not something the incoming administration can do via executive action—Congress controls government spending, and this would require new legislation. But the budget reconciliation process results in bills that cannot be filibustered, and Reuters says that the Trump transition team will likely use this route as part of a larger revamp of tax laws.
Tesla was a major beneficiary of the new clean vehicle tax credit; under the previous scheme, an OEM was only eligible until it sold its 200,000th plug-in vehicle, at which point the credit available to its customers began to sunset. Tesla—which exclusively sells plug-in vehicles—was unsurprisingly the first to reach this threshold, at which point its EVs became more expensive than competitor cars. But the sales cap was eliminated under the new rules.
One might expect the company would be up in arms over this proposal. But according to Reuters, that’s not the case—Tesla is in favor of ending the clean vehicle tax credit, and CEO Elon Musk has previously said such a move would be far more damaging to rival companies than to Tesla.
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