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House passes Biden's Build Back Better bill with $12,500 EV tax credit

The long-stalled bill now heads to the Senate, where it faces fresh hurdles.

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sean-szymkowski-headshot
Sean Szymkowski
It all started with Gran Turismo. From those early PlayStation days, Sean was drawn to anything with four wheels. Prior to joining the Roadshow team, he was a freelance contributor for Motor Authority, The Car Connection and Green Car Reports. As for what's in the garage, Sean owns a 2016 Chevrolet SS, and yes, it has Holden badges.
Sean Szymkowski
2 min read
Capital Hill

The bill now goes to the Senate.

Chip Somodevilla/Getty Images

After months of negotiations and stalled voting, the US House of Representatives passed President Joe Biden's $1.9 trillion Build Back Better bill with a final tally of 220-213 on Friday. The legislation includes a massive overhaul to the federal electric vehicle tax credit system, with the potential for a $12,500 refundable credit for buyers.

One Democrat voted against the legislation; no Republicans supported the cornerstone of Biden's domestic agenda, which earmarks the proposed funds for numerous social programs. The vote comes a week after the chamber passed the president's Bipartisan Infrastructure package, which included a rule to vote for the Build Back Better bill this week.

While the bill's passage is a major step forward for the president's agenda, the legislation faces additional challenges over in the Senate. The package requires every single Democratic senator to vote for it, but two holdouts remain: Sens. Joe Manchin and Kyrsten Sinema. Should the two senators give their final approval, Vice President Kamala Harris could cast a tie-breaking vote and move the legislation to Biden's desk for a signature.

The Build Back Better bill is a huge deal for the auto industry: The agenda includes giant overhauls to the EV tax credit system., which currently stands at a nonrefundable $7,500 credit that never puts cash back in an EV buyer's pocket. However, the House-approved version of the bill changed this to a refundable credit. Proposed changes include crediting EV purchasers with up to $12,500 at tax refund time. The $7,500 base credit could increase $4,500 if an EV is made in the US with union labor and another $500 for a US-made battery.

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Watch this: How Biden's 'Buy American' initiative plans to 'build back better'