US Senate Republicans on Saturday released a revised version of President Donald Trump’s tax cut and spending bill, proposing to eliminate nearly all federal incentives for electric vehicles (EVs) and clean energy technologies by the end of September.
The “One Big Beautiful Bill Act” would terminate the $7,500 federal tax credit for new EVs and the $4,000 credit for used EVs on September 30, 2025.
In addition, it would immediately disqualify leased EVs that do not meet final assembly and battery sourcing requirements in North America.
These provisions are detailed in Sections 70501 through 70504 of the bill, which is part of a broader package aimed at reversing policies introduced in the Inflation Reduction Act.
Answering on X to a user who asked, “Who wants this? The country’s automakers don’t want it […]”, Tesla CEO and Trump advisor Elon Musk replied: “Good question. Who?”
“At the same time, this bill raises the debt ceiling by $5 TRILLION, the biggest increase in history, putting America in the fast lane to debt slavery!” he added.
Last November, Musk wrote on X the country should eliminate all government subsidies.
“In my view, we should end all government subsidies, including those for EVs, oil and gas,” Tesla CEO wrote.
The revised version significantly alters the timing and scope of EV credit termination compared to the previous draft.
The earlier version proposed ending EV tax credits based on a fixed period following the bill’s enactment — with indications of a 180-day phaseout for new vehicles, 90 days for used EVs, and immediate elimination for leases that failed to meet U.S. sourcing rules.
In contrast, the updated text sets a firm statutory cutoff date of September 30 for both new and used EV credits, regardless of when the bill is enacted.
The language also formalises the immediate disqualification of leased vehicles that are not assembled in North America or fail to meet battery component thresholds.
The new bill further expands beyond tax policy.
While the original version of Title VII focused exclusively on personal and business tax code adjustments, the revised act is a wide-ranging omnibus measure that includes entire titles on energy policy, environmental funding, immigration, health care, and military spending.
Specific to EVs and clean transport, the new version adds repeals for related charging infrastructure credits and removes subsidies tied to clean hydrogen, zero-emission power, and low-carbon building materials.
In parallel with repealing green subsidies, the bill introduces provisions to expand oil and gas leasing on federal lands, promote coal development, and boost U.S. fossil fuel production.
A new section on “energy dominance financing” suggests a redirection of federal resources away from climate-oriented spending and toward traditional energy sectors.
The proposal also rescinds dozens of environmental and climate-related grant programmes, including funding for clean school buses, low-emissions electricity, and greenhouse gas reporting.
Although the legislation is unlikely to advance in the Democratic-led Senate, it offers a preview of Republican energy and fiscal priorities heading into the 2026 midterm elections.
At a recent event, Trump said that his plans to cut EV tax credits were “not something new” and that he was surprised that Musk was endorsing him.
To Trump, it is clear that “a lot of people love electric. They love Tesla.” He added that so does he, “in all fairness.”
“I like Tesla, and I like others too, but I also like combustion engines,” the President concluded.
