Restoring Vehicle Market Freedom Act of 2025
Restoring Vehicle Market Freedom Act of 2025 would repeal a range of federal tax incentives that currently support alternative fuel vehicles and related infrastructure. Specifically, the bill would eliminate credits for: (1) previously owned clean vehicles; (2) new or certain motor vehicles that qualify as “alternative motor vehicles”; (3) fueling/refueling property for alternative fuels; (4) new qualified plug-in electric drive motor vehicles; and (5) qualified commercial clean vehicles. The repeal would apply only to purchases, acquisitions, or property placed in service after the date the bill becomes law, meaning transactions that occur before enactment could still be eligible under existing rules. The bill also makes numerous conforming changes to the Internal Revenue Code to remove references to these credits from other tax provisions and to align other tax-related rules with the repeal. In short, the bill shifts federal policy away from providing tax-based incentives for AFVs and related infrastructure, with the intent of “restoring vehicle market freedom” by removing these credits going forward.
Key Points
- 1Repeal of the previously owned clean vehicle credit (Section 25E). Applies to vehicles acquired after enactment; pre-enactment acquisitions may still be eligible under prior rules.
- 2Repeal of the Alternative Motor Vehicle Credit (Section 30B). Applies to property purchased after enactment; post-enactment purchases would not qualify for this credit.
- 3Repeal of the Alternative Fuel Vehicle Refueling Property Credit (Section 30C). Applies to property placed in service after enactment; post-enactment installations would not qualify.
- 4Repeal of the New Qualified Plug-In Electric Drive Motor Vehicle Credit (Section 30D). Applies to vehicles acquired after enactment; includes numerous conforming amendments to other tax provisions to remove references to 30D and reflect pre-enactment rules for related cross-references.
- 5Repeal of the Credit for Qualified Commercial Clean Vehicles (Section 45W). Applies to vehicles acquired after enactment; includes conforming amendments to remove references in related tax rules.
- 6Additional note: The bill includes broad conforming amendments to remove references to these credits in other parts of the tax code and adjusts several provisions to reflect the post-enactment repeal, including treatment of certain items “as in effect on the date before enactment” in related sections where applicable.