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The federal government’s incentive to the buyer of a new Prius in 2004 and 2005 is that he or she may qualify for a reduction of $2000 in taxes by the IRS.
To foster investment, certain states offer a number of incentives. Here are some of the economic benefits for companies using hybrid cars:
- Colorado offers a tax credit in addition to that offered by the IRS.
- Connecticut exempts sales tax on hybrid cars of at least 40 mpg, as rated by the EPA.
- Maine exempts $500 on sales tax to buyers of on a new Prius.
- New Mexico keeps an EPA benchmark limit of 27.5 mpg, on which it allows a one-time exemption of 3 percent of the cost of a hybrid car.
- Oregon permits a state income tax credit to a maximum of $1500 to buyers of hybrid cars that qualify.
- Pennsylvania subsidizes the cost of a new hybrid car under specific conditions.
- Maryland and Virginia do not require hybrid cars to take a mandatory emission test.
- In addition, by using hybrid cars, companies will bring down their overheads as gasoline is expensive. This will ultimately translate to a better bottom line for many companies.
Another possible incentive to encourage hybrid cars, is single-occupancy driving in HOV (high-occupancy vehicle) carpool lanes. While this is under consideration by several states it has been implemented only in Virginia so far. Several states have passed such or similar legislation in favor, awaiting the nod of the federal government to approve such laws.
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