More tax credit proposed for hybrid vehicles

United States Rep Rahm Emanuel (D-IL) announced he will introduce the American Hybrid Tax Credit Act of 2005, which will increase tax credits for consumers and small businesses that purchase hybrid and other alternative-fuel motor vehicles assembled in the United States.

Current US energy policy provides a tax credit ranging from $1,700 to $3,400 for buyers of hybrids, depending on the model purchased, beginning Jan 1, 2006. Emanuel's legislation raises the credit for individuals and small businesses purchasing hybrid and other alternative-fuel motor vehicles assembled in the United States by $3,000. His legislation also increases the credit available to manufacturers for using new advanced lean burn technology by $3,000 and raises the credit for domestic research and development related to alternative motor vehicle technology from 20% to 40%.

Emanuel also called for the federal government and recipients of federal financing to use hybrid technology in transportation fleets by 2015.