Establishing a $2,500 tax credit for the purchase of electric vehicles in North Carolina would boost the state’s GDP by $52 million over the next 16 years, says a new study.
The study, “Impact of Introducing an Electric Vehicle Rebate on the North Carolina State Economy,” which was published by Keybridge Research, highlights two key factors that would account for the GDP increase.
First, state drivers would pay less for transportation fuel over the years, which would result in more spending on other state produced-goods and services. Second, the tax credit would cause more North Carolina households to buy electric vehicles and therefore receive the federal government’s $7,500 EV income tax credit. The federal credit would represent a form of additional net income to families in the state.
The study also found that the tax credit would save North Carolina drivers $50 million in gasoline bills over the next five years. This amount is partially offset by $20 million in increased electricity consumption. The savings would increase to $233 million through 2031.
The tax credit would also have a five-year cumulative GDP gain of $37 million, according to the study. The tax credit would apply to the purchase of battery-electric vehicles and plug-in hybrids that have an electric battery capacity of at least 10 kilowatt hours.
The study was commissioned by Securing America’s Future Energy in partnership with the Electrification Coalition.