On March 22, 2023, Governor Spencer Cox of Utah signed H.B. 301, which will impose a 12.5% tax on electric vehicle charging starting in 2024. The tax will be imposed on electric current sold by a charging station to be assessed on sales per kilowatt hour, sales per hour, or a subscription fee. H.B. 301 also lowers the state’s tax on motor fuel to 14.2% starting in 2024. The motor fuel tax will be imposed at 34.5 cents per gallon from July 1 through the end of 2023.
Electric vehicle charging is in the sights of lawmakers as a new source of revenue, particularly because increasing sales of electric vehicles are resulting in less gas tax revenue. Beginning July 1 in Iowa, an electric fuel excise tax of 2.6 cents per kilowatt hour will apply at public charging stations. Beginning January 1, 2024, Kentucky and Oklahoma will make charging at public stations subject to a 3-cents-per-kilowatt hour tax. Legislation to tax electric vehicles by registration or charging has also been proposed in Georgia and Minnesota. We can also expect to see developments in other states that may clarify the scope of sales tax exemptions on electricity for residential use when it comes to charging electric vehicles.
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Ryan
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britte.kirby@ryan.com
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