State and Local Policy Database

Incentives for High-Efficiency Vehicles

The high cost of advanced-technology fuel-efficient vehicles is a major barrier to their entry into the marketplace. To encourage consumers to purchase these vehicles, states may offer a number of financial incentives, including tax credits, rebates, and sales tax exemptions.

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

Electric vehicles in Arizona pay a significantly reduced vehicle license tax as part of the state’s Reduced Alternative Fuel Vehicle License Tax program. The vehicle license tax on an AFV is $4 for every $100 in assessed value. 

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

AB 118 targets medium- and heavy-duty trucks in a voucher program whose goal is to reduce the up-front incremental cost of purchasing a hybrid vehicle. Vouchers for up to $117,000 are available, depending on vehicle specifications, and are paid directly to fleets that purchase hybrid trucks for use within the state.

California also offers rebates of up to $5,000 for light-duty zero-emission EVs and plug-in hybrid EVs on a first-come, first-served basis.

Last Updated: July 2017

Colorado offers a flat $5,000 credit for the purchase of a light-duty electric vehicle and makes the credits assignable to a car dealer or finance company effectively turning the credit into a point of sale incentive. In 2020, this credit falls to $4,000 and then again to $2,500 in 2021. Credits are also available for medium- and heavy-duty trucks. 

Last Updated: July 2017

Connecticut’s Hydrogen and Electric Automobile Purchase Rebate Program provides as much as $3,000 for the incremental cost of the purchase of a hydrogen fuel cell electric (FCEV), all-electric, or plug-in hybrid electric vehicle. Rebates are calculated based on battery capacity. Vehicles with a battery capacity of 18 kilowatt-hours (kWh) of more earn $3,000 while those with capacities between 7 kWh and 18kWh earn $1,500. Vehicles with batteries smaller than 7 kWh are eligible for a rebate of $750.

Last Updated: July 2017

The Delaware Clean Vehicle Rebate Program offers rebates for alternative fuel vehicles. The rebate amount ranges between $1,000 and $3,500 depending on the type of vehicle: new plug-in, conventional converted, etc. The total budget of the program is $2,500,000. The rebate limits are set to one per individual and six per fleet. Only residents and organizations from the state of Delaware are eligible to participate in the program. 

Last Updated: July 2017

The District of Columbia allows owners of Alternative Fuel Vehicles (AFV) and vehicles that achieve an estimated average city fuel economy of 40mpg according to the EPA to be exempt from vehicle excise taxes. Reduced vehicle registration fees also apply to owners of such vehicles.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

An income tax credit is available to individuals who purchase new commercial medium- or heavy-duty vehicles that run on alternative fuels including electricity. Medium-duty vehicles qualify for a credit up to $12,000, while heavy-duty vehicles can earn a credit of up to $20,000.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No program in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

Electric vehicles purchased in Louisiana qualify for a tax credit that amounts to 50% of the incremental cost of the vehicle. Tax payers may alternatively qualify for a tax credit equivalent to the lesser of 10% of the cost of the purchased electric vehicle or $3000.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

Purchasers of qualifying all-electric and plug-in hybrid-electric light-duty vehicles may claim up to $3,000 against the vehicle excise tax in the state of Maryland, depending on the battery weight of the vehicle. 

Last Updated: July 2017

The Massachusetts Offers Rebates for Electric Vehicles (MOR-EV) Program offers rebates of up to $2,500 to customers purchasing PEVs. 

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

All zero emission vehicles (ZEV) in the state of New Jersey are exempt from state sales and use taxes.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

Pursuant to legislation passed in April 2016, NYSERDA developed a rebate program for zero emission vehicles that launched in March 2017. Rebates of up to $2,000 per vehicle are available for battery electric vehicles, plug-in hybrid electric vehicles, and fuel cell vehicles. New York also started the New York Truck Voucher Incentive Program in 2013. Vouchers of up to $60,000 are available for the purchase of hybrid and all-electric class 3-8 trucks. In March 2017, New York State launched the Drive Clean Rebate, which provides up to $2,000 for each new EV purchased. 

Last Updated: August 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

The Alternative Fuels Incentive Grant (AFIG) Program provides rebates for Alternative Fuel Vehicles. 

Last Updated: July 2017

The Driving Rhode Island to Vehicle Electrification (DRIVE) rebate program offers rebates for vehicles purchased on or after January 29, 2016 though this program is currently suspended due to lack of funding. The amount of the rebate ranges from $500 (battery capacity less than 7 kWh) to $2500 (battery capacity over 18 kWh). 

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

The Texas Emissions Reduction Program, which promotes clean air, includes a $2,500 rebate for electric-car buyers, who are also eligible for a $7,500 federal tax credit. Governor Abbott signed the program into law on June 12th and the rebate goes into effect on Sept. 1, 2017.

Last Updated: July 2017

Until December 2020, taxpayers are eligible for a tax credits for the purchase of qualifying electric heavy-duty vehicles. Vehicles purchased in 2017 are eligible for a $25,000 tax credit. Between 2018 and 2020, tax credits are gradually reduced from $20,000 to $18,000.  

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017 

No policy in place or proposed.

Last Updated: July 2017

Electric vehicles are exempt from state motor vehicle sales and use taxes under the Alternative Fuel Vehicle Tax Exemption program.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017

No policy in place or proposed.

Last Updated: July 2017