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Are electric cars merit goods?
Are electric cars considered merit goods? As in, will the government start to subsidize them or give them out for free because 1) they’re under-utilized and 2) good for the environment?
Jason Crosby · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
Ambitious thinking, and maybe at some point—but for right now, the Federal Government is not subsidizing electric vehicles, or giving them away for free. Keep reading if you’d like to know more about what the feds are doing to incentivize Americans to go electric.
One of the primary initiatives that the government has taken up in order to convince car owners to buy electric vehicles has been tax credits. Beware, though—tax credits have run out for a few manufacturers and some specific models, including the Hummer EV and all of Tesla’s models.
Tax credits are available up to $7,500 dollars, which, if you owe close to that amount or more, could help eliminate some of your tax debt.
It’s certainly possible that at some point in the future, EVs may become subsidized, but it’s more likely that the current infrastructure plans will support public transportation that runs on electricity, such as lightning rails and electronic city buses. These two initiatives are already underway in several major cities, and could change the way that many of us conduct our daily commute.
One of the reasons that EVs probably will never be considered as a merit good is because owning a personal vehicle is a financial liberty, and the government isn’t going to pay to insure an electric vehicle. The closest Americans can currently get to such a deal is the Californian Clean Fuel Reward, which is being offered at participating dealerships in CA. Buyers who purchase or lease a qualifying EV can receive up to $1,500 in funds for their green purchase.
Jerry
can’t offer free fuel, but we can sure help you save money on insuring your electric car. With access to the best deals from the nation’s top car insurance providers, there’s never been a better time to start shopping for more affordable coverage. MORE: By 2035, New Gas-Powered Cars Will Be Banned in This Country
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- Gregory R.
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Jerry partners with more than 50 insurance companies, but our content is independently researched, written, and fact-checked by our team of editors and agents. We aren’t paid for reviews or other content.
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