Federal tax credit to expire for EV purchases but state credit will continue

NEW MEXICO (KRQE) – Last week, the U.S. Environmental Protection Agency made the move to repeal some greenhouse gas emission regulation standards for vehicles. These changes in emissions standards will impact people buying electric cars nationally and in Albuquerque. Even though the federal tax credit will be going away, the good news is that New Mexico will offer a lesser tax credit that will not be going away.

“The state has rebates that will last beyond September 30,” City of Albuquerque Sustainability Officer Ann Simon said. “The federal rebates will expire. So now’s a great time to buy; they don’t just apply to new vehicles, they apply to used vehicles as well.”

Currently, EV buyers receive a tax credit of up to $7,500. Starting October 1, they will no longer receive this. The state, however, does have its tax credit program that gives up to $3,000 back to EV buyers in New Mexico. In addition, the state board is holding a hearing in the next few weeks to adopt a new Clean Fuel Rule. This will go along with the Clean Transportation Fuels Act, which passed last year. “As purchasers of fuels, what we’ll see are more options at the pump or more availability of different kinds of fuels and vehicles,” NMED Environmental Protection Director Michelle Miano said.

This would also decrease costs for fuel and vehicles available for purchase in New Mexico.
The petition goes to the board hearing on September 22, and would potentially go into effect in early 2026.

City and state leaders encourage New Mexicans who have been thinking of buying an EV to do so now before they lose most of the tax credits offered at the end of next month. The city also offers a program called AMP, where residents can rent an EV by the hour. The city says it’s a great way to try an EV out before making the commitment to buy.

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