Colorado will quickly grow to be the state with probably the most beneficiant EV tax credit within the US, providing electrical automobile consumers a $5,000 credit score that may be stacked with as much as $7,500 in federal incentives.
The Colorado legislature handed a number of payments earlier this month which are designed to assist speed up the adoption of cleaner transportation, complementing the Inflation Discount Act and American Restoration Act to incentivize shoppers to purchase new electrical automobiles and residential home equipment.
Governor Jared Polis signed HB23-1272, Tax Coverage That Advances Decarbonization, which not solely will increase and extends the state EV tax credit score for passenger automobiles, but additionally for electrical medium and heavy-duty vans. The invoice additionally units up a brand new statewide point-of-sale incentive for e-bikes and expands tax credit for in-home warmth pumps.
Beginning July 1, 2023, the Colorado EV tax credit score will increase from a present $2,000 to $5,000 for automobiles with a beginning MSRP as much as $80,000. This can be a important rise that interprets into whole potential tax credit (state plus federal) of $12,500, assuming the patron qualifies for each.
However wait, it will get much more fascinating. Starting January 1, 2024, the brand new invoice additionally establishes a further tax credit score of $2,500 for EVs with an MSRP below $35,000. Which means Colorado residents who purchase an EV that prices below $35K will get each the $5,000 state EV tax credit score and the $2,500 further incentive – on prime of the $7,500 federal tax credit score.
Below this best-case state of affairs, Colorado residents may get a complete of $15,000 in state and federal incentives by stacking all three tax credit. Which means Tesla’s rumored $25,000 compact automobile would successfully value eligible Colorado residents simply $10,000!
The Colorado state EV tax credit score steps down yearly by way of 2029. It is price noting that Colorado’s EV tax credit score was once $5,000 however was diminished to $2,000 in 2021.
Shifting on to electrical vans, the invoice will increase the state tax credit score to $12,000 for medium and heavy-duty (MHDV) electrical vans by way of 2032. That is designed to assist fleets in Colorado adjust to the just lately adopted Superior Clear Truck and Low NOX guidelines. The tax credit might be layered with federal tax credit score for max financial savings as much as $40,000 per truck.
Lastly, the invoice establishes a brand new statewide incentive of $450 for e-bikes starting April 2024. The credit score is taken at point-of-sale, which implies the client experiences it as a direct low cost when paying for the bike.