U.S. Passes Bill Scrapping $7,500 EV Tax Credit

In a major shake-up for electric vehicles and the clean energy sector, the U.S. House has officially passed President Donald Trump’s “Big Beautiful Bill,” which includes the elimination of the federal EV tax credit. The bill, which now heads to Trump’s desk for his signature, will officially end the $7,500 EV tax credit on September 30, 2025.

Once signed into law, the legislation will kill several key clean energy incentives:

• The $7,500 EV tax credit for new electric vehicles, the $4,000 credit for used EVs, and the $7,500 commercial EV credit will all expire on September 30, 2025.
• The Alternative Fuel Vehicle Refueling Property Credit will end on June 30, 2026.
• The Home Energy Efficiency Improvements Credit is set to expire for upgrades placed in service after December 31, 2025.
• The Residential Clean Energy Credit will end for expenses made after December 31, 2025.
• The New Energy Efficient Home Credit will end on June 30, 2026.

While this bill marks a major reversal in U.S. clean energy policy, it could trigger a near-term EV sales boom. With the clock now ticking on the $7,500 federal incentive, many buyers may rush to lock in orders before the credit disappears this fall. That could set the stage for a blockbuster third quarter for Tesla and other EV makers.

Tesla, which dominated U.S. EV sales during Q2 2025 with approximately 151,000 units sold but saw a 9% dip year-over-year, stands to benefit greatly from the impending scramble — at least in the near term. General Motors, which had its strongest EV quarter yet with around 46,000 units sold, could also see a sales surge in the coming months.

With EV affordability set to take a hit, the industry will be watching closely to see how this plays out heading into 2026. Expect automakers to ramp up promotions as the deadline approaches, but what then? Will Tesla continue to bank on its brand recognition and competitive advantages to drive sales, or could the company’s long-rumoured $25,000 EV finally be on the horizon?

Let us know what you think in the comments below.