How EV fees stack up in Michigan
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Federal tax credits for electric vehicle purchases are now dead, and Michigan isn't among the states that have their own tax breaks for EVs.
Why it matters: States differ in offering financial rewards and/or charging higher fees for EV users. That variation reflects an industry in flux, as policymakers try to balance environmental goals with the need for more funding to pay for roads and infrastructure.
Catch up quick: Biden-era federal tax credits on EV purchases — up to $7,500 for new EVs and up to $4,000 for pre-owned EVs — were killed by Congress, effective Sept. 30.
Yes, but: Tax credits and rebates aimed at increasing EV adoption sometimes run counter to other fees levied against EV owners, note researchers at the Tax Foundation, a nonpartisan think tank that mostly supports lower taxes.
Context: States fund most of their road and infrastructure budgets with revenue from gasoline taxes. Since EV owners don't pay gas taxes, 40 states have extra fees on battery-powered cars to ensure they pay their share for road maintenance.
Zoom in: Michigan's EV registration fee is currently $160 (or $60 for plug-in hybrids) on top of regular registration fees.
What to watch: Some experts say a better way to pay for roads is to institute a vehicle miles traveled (VMT) tax to charge everyone based on how much they drive.
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