Senator Urges US Makers to Contest EV Tax Credits in Court
TL/DR –
Senator Joe Manchin has called on American companies to sue the Treasury Department, accusing it of enacting rules that harm US manufacturers. He is critical of how the Treasury implemented the Inflation Reduction Act (IRA), particularly its decision to halve local content requirements extending reliance on Chinese supply chains. Specifically, Manchin cites the allowance for automakers to use Chinese graphite and other crucial minerals in battery production for an extra year as a deviation from the IRA’s aim of reducing dependence on Chinese supply chains.
Senator Manchin Urges U.S. Companies to Sue Treasury over IRA Content Rules
Senator Joe Manchin is urging U.S. companies to sue the Treasury Department over revised rules of the Inflation Reduction Act (IRA), alleging harm to U.S manufacturers. His criticism primarily focuses on the decision to halve local content requirements, which he believes extends reliance on Chinese supply chains. The final rules permit the use of Chinese minerals in EV battery production until 2027, a decision that has sparked Manchin’s opposition.
In a Senate Appropriations Committee hearing, Manchin voiced his concerns to U.S. Treasury Secretary Janet Yellen. He stated that the Treasury’s decision to minimize local content requirements from the original stipulations in the IRA is damaging to U.S. manufacturers. He urged manufacturers to engage in legal action against the Treasury and offered his support by promising to “do the amicus brief on (their) behalf.”
Having recently left the Democratic Party to become an independent, Manchin has expressed strong opposition against the IRA’s implementation by the Treasury. He argues that it undermines U.S. industry by prolonging dependence on Chinese supply chains.
Manchin expressed his disapproval concerning the Treasury’s decision to allow automakers to continue using Chinese minerals in battery production for another year. He believes this violates the original intent of the IRA, which was designed to lessen reliance on Chinese supply chains. This assessment was reported by Reuters.
Meanwhile, the U.S. government recently finalized rules concerning the $7,500 clean vehicle tax credit, expanding the range of electric vehicles eligible for the incentive. Among the changes is a new “traced qualifying value add test,” allowing manufacturers to continue using the 50 percent roll up in the proposed regulations as a transition rule until 2027.
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