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Obama to seek electric car tax break

Bloomberg News / February 9, 2011

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WASHINGTON — President Obama will propose that consumers receive a $7,500 tax credit for electric cars at the dealership, reducing the sticker price.

The initiative will be included in the president’s proposed budget next week, said David Sandalow, an assistant secretary at the Energy Department.

Consumers who have previously used hybrid- and electric-vehicle credits have received the benefits when they filed their tax returns. The administration wants to make the cars more affordable at the point of sale, Sandalow said.

The administration will also propose grants for as many as 30 municipalities to build infrastructure to recharge electric vehicles. The budget plan will also include new research and development investments in electric drive, battery, and storage technologies, Sandalow said.

J.D. Power and Associates, a research company, projected last month that under current market conditions, there would be 750,000 plug-in hybrid vehicles like General Motors Co.’s Chevrolet Volt and battery-electric cars like Nissan Motor Co.’s Leaf by 2015.

GM, with about 24 percent of the electric-vehicle market, and Nissan will be the winners, because they are already selling the cars, said J.D. Powers’s Michael Omotoso.