The $7,500 tax credit for U.S.-made electric vehicles is meant to support climate goals and U.S. manufacturing, but complexities and loopholes dilute its effectiveness.
Overall, researchers found that Americans have seen a two-to-one return on their investment through the new electric vehicle subsidies, primarily benefiting U.S. profits.
The I.R.A. successfully redirected subsidies to American automakers, although a loophole allowed benefits for foreign-made vehicles, leading to additional environmental and safety costs.
Despite the benefits of the I.R.A., for every electric vehicle purchase incentivized by the credit, approximately three buyers would have purchased these vehicles anyway.
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