Efforts to pass President Joe Biden’s $2 trillion social spending and climate bill known as Build Back Better stalled in February, meaning that provisions that benefit both new and old e-bike riders have stalled as well.
One of the main drivers of BBB was to take steps to mitigate climate change by incentivizing Americans to use other means of transportation instead of their cars. One of the ways Democrats planned to do this was a tax incentive for e-bike riders.
The current version of the bill passed by the House of Representatives last year offered some Americans a refundable, 30 percent tax credit on the purchase of e-bikes.
Any individual making $75,000 or less would qualify for the maximum tax credit of up to $900. Households filing jointly who make up to $150,000 would qualify for the $900 tax credit for up to two bikes. The credit beings to phase out at higher income levels and any e-bike over $4,000 wouldn’t qualify for the tax credit.
This provision in BBB would potentially be a positive step in helping reduce greenhouse emissions in which transportation accounts for 29 percent of all emissions from human activities, according to a 2019 EPA report.
However, despite passing in the House the bill was unable to gain traction in the Senate where Democrats hold a razor-thin 50 vote majority. Sen. Joe Manchin (D-WV) effectively killed the bill in December when he stated he wouldn’t support it in its current form. This means the tax credit for e-bike riders is in doubt as the bill could either not be passed at all or passed but revised to exclude the e-bike tax credit.
The end of the e-bike tax credit comes at a time when e-bikes are soaring in popularity. E-bikes saw a 240 percent increase in sales revenue last year, according to market research firm NPD Group. The increased sales of e-bikes even surpassed road bikes which are one of the most popular bike categories and the most commonly used bike by urban commuters.
Congress’s failure to pass the e-bike tax credit may not decrease the popularity of e-bikes; however, it certainly will prevent some potential e-bike riders from joining the fun. E-bikes are on average more expensive than conventional bikes and a lack of incentives may price a few potential riders out of the market.
BBB is currently in limbo and until it is passed new and old e-bike riders can expect little to no e-bike incentives from the federal government.