According to the recently concluded conference on the Stimulus Bill, everything pretty much stays the same. There are tax credits added for plug-ins that won’t be out until the next two years or so, but no tax credits are mentioned for the purchase of hybrid vehicles available today.

Otherwise known as the American Recovery and Reinvestment Act of 2009, this stimulus bill is worth $787 billion all in all. Presently, it gives up to $2500 tax credit for buyers of low-speed new electric vehicles. However, this has been criticized as a “pork barrel” for golf carts.

On the plus side, however, it allows new car buyers this year to deduct the local and state taxes paid on their vehicle purchases from their annual federal taxes. While $1.7 billion is allocated to fund this tax deduction, this move received a lukewarm reaction from consumers, probably because they won’t be seeing the figures realized until the end of 2009.

(more…)

Car importers question the US Senate’s proposal to give $10,000 credit to people who would hand over their old motor vehicles in exchange for newer, more fuel efficient models.

This proposal is tagged the Harkin-Stabenow amendment, and most US lawyers have reason to believe that it violates important aspects of the World Trade Organization rules, as well as the North American Free Trade Agreement.

Car manufacturing and dealing companies are fearful about the effects of this move on the US economy. With the new amendment, there’s a big possibility that car sales will drop drastically this year. The US happens to hold a big chunk of the world’s car manufacturing industry.

The other side of the coin

On the plus side, a lot of environmentalists and households are excited about the immediate effect of this amendment. Most people refuse to hand-over their 10-year-old faithful for newer, cleaner models simply because they can’t afford to pay for a new car.

(more…)