Hybrid-owner Bennett revs up tax-credit bill for car buyers
Bennett, a Republican, admitted the bill would go nowhere this Congress, where the session is quickly coming to a close, but offered the bill anyway so at least the idea is out there and discussions can get started.
Bennett, along with Sen. Ron Wyden, D-Ore., said the Oil Independence, Limiting Subsidies and Accelerating Vehicle Efficiency Act, nicknamed with the acronym OILSAVE, would give a tax credit of up to $1,860 for the most efficient vehicles. The credit would be on a sliding scale starting at $630 with more fuel efficient cars getting the bigger credits.
New cars eligible for the one-time credit must get at least 34.5 miles per gallon with sport utility vehicles and light trucks at 27.5 miles per gallon for model years 2007 through 2011.
Car buyers could claim the credit on their tax return or transfer it to the car dealer for a cash-back option when they buy the car initially.
Bennett said he was the first member of Congress to buy a hybrid car when he bought his Honda Insight, which he drove for four years. But he said it was mainly a commuter car and his wife wanted something a little bigger. So he now has a 2005 silver Ford Escape hybrid — perfect for hauling things home from Costco or putting luggage in the trunk, Bennett said.
Wyden said the bill is "marketplace oriented and fully paid for."
He said in the past, the auto industry has been concerned about buyers wanting to purchase the fuel-efficient cars, which often have higher price tags than regular models. But Wyden said this bill directly addresses the concerns that have come from the industry by creating a bigger incentive for buyers.
Car buyers could claim the credit on their tax return or transfer it to the buyer for a cash-back option when they buy the car initially.
The bill finds the money to support the credit by eliminating a tax credit now offered to oil companies.
"Oil companies have said they don't need it, so I said if you don't need those we'll borrow them from you," Bennett said.
The bill repeals the tax credit for the oil companies saving $6.8 billion and covers the cost of the OILSAVE tax credit, estimated at $1.3 million.
There is an existing tax credit for hybrid cars in the Energy Policy Act Congress approved last year, but this bill takes a "technology neutral approach" by extending the credits to all types of more fuel-efficient cars, not just hybrids.
Wyden said this is a "simpler and fairer" approach than what exists in the current energy plan because it eliminates the phase-out of the credit based on the number of cars sold.
"It doesn't pick winners and losers among competing technologies," Wyden said.
E-mail: suzanne@desnews.com
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