YourVoice.Now Summary
Your MoneyCorporate BenefitsEnvironmentTransparency & AccountabilityPairs a $5,000 credit for fuel-efficient 2027 vehicles with a new automaker fee on less efficient SUVs and pickups from 2029.
Your Money
The credit is a share of $5,000, based on how far the vehicle beats the prior year's midpoint mileage. It is refundable, so you get it even if you owe no income tax.
You can sign the credit over to the dealer when you buy. The dealer must then certify to the Treasury that it cut your price by the full credit amount.
A vehicle can earn this credit or the electric vehicle credit, but not both. The window sticker must warn you that taking this one gives up the other.
Corporate Benefits
Companies that buy qualifying vehicles claim the credit through the business credit rules. It would also count against the alternative minimum tax.
Today's gas guzzler tax covers passenger cars but not SUVs and pickups. The replacement fee would cover both, beginning with model year 2029.
Environment
A vehicle qualifies only if it beats the midpoint mileage of all new vehicles sold the year before. As new vehicles get cleaner, the bar to qualify rises each year.
Today the EPA may use this formula only when a maker asks for it. The bill would require it from model year 2026, with a review every three years.
Transparency & Accountability
Automakers must report each model's mileage and sales count by November 1. The Treasury must then post the midpoint and best figures by December 1, starting in 2026.
The window sticker would list the credit amount for that exact vehicle. Buyers would see it before agreeing to a price.
Labels would show mileage on the alternative fuel alone, plus a multi-day average for mixed use. This starts with model year 2027 vehicles.
More about this bill
Buyers of a fuel-efficient new vehicle could get up to $5,000 back, starting with model year 2027. The credit is refundable. You would get it even if you owe no income tax. You could also sign it over to the dealer and cut the price that day. The dealer would have to pass on the whole amount. To qualify, a vehicle must beat the midpoint gas mileage of the year before. Top-rated models earn the full $5,000, and models just above the midpoint earn much less. You could not take the electric vehicle credit on the same vehicle. The gas guzzler tax on automakers would be replaced by a new fee, starting with model year 2029. Today that tax covers cars but not SUVs and pickups. The new fee would cover them too. It grows the further a vehicle falls below the midpoint, and is set from a $5,000 base figure. Automakers owe the fee, not buyers. Heavy commercial trucks, ambulances, police cars, and other emergency vehicles would be exempt. Automakers would report each model's gas mileage and sales count to the Treasury every November. The Treasury would then post the midpoint and best figures by December 1. Window stickers would show the credit amount before you buy. Stickers on plug-in hybrids would show gas and electric mileage apart, starting with 2027 models. The EPA would have to update how it splits the two every three years, using real-world data. The credit's $5,000 cap would rise with inflation after 2027.
Congressional Summary
Vehicle Energy Performance Act of 2025 This bill creates a refundable tax credit for the purchase of a new (2027 model year or later) qualified high energy performance motor vehicle. The bill also modifies the calculation of the excise tax on the sale by a manufacturer or importer of a fuel-inefficient vehicle (known as the gas guzzler tax). The amount of the tax credit for a new qualified high energy performance motor vehicle is based on a vehicle’s energy performance in the current and prior model year in comparison with the median and best vehicle energy performance overall in the prior model year, up to a maximum of $5,000. To qualify for the tax credit, the vehicle must be a passenger automobile or light truck with a greater than median energy performance (based on miles per gallon-gas equivalent) as compared to the same passenger automobile or light truck for the prior model year. (Conditions apply.) The bill requires the Department of the Treasury to publish the median and best vehicle energy performance for the model year based on information reported by vehicle manufacturers. Finally, the bill modifies the gas guzzler excise tax so that the amount is based on a vehicle’s energy performance in the current and prior model year in comparison with the median and best vehicle energy performance overall in the prior model year. (Currently, the gas guzzler tax is imposed on vehicles that do not meet a fuel efficiency standard of at least 22.5 miles per gallon.)
Details
- Congress
- 119th
- Chamber
- House
- Status
- summarized
- Action
- Introduced in House
- Action Date
- 2025-02-13
- Date Added
- 2026-05-05
- Source
- Congress.gov →
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