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Notice 2023-1 which provides proposed definitions of certain terms relevant for the section 30D credit.
White Paper on "Anticipated Direction of Forthcoming Proposed Guidance on Critical Mineral and Battery Component Value Calculations for the New Clean Vehicle Credit"
As described in more detail below, to determine if a vehicle satisfies the critical mineral and battery component requirements, one must determine (1) if a threshold percentage of the value of the critical minerals in a vehicle's battery is extracted or processed in the United States or "free trade agreement" partner countries or recycled in North America and (2) if a threshold percentage of the value of the vehicle's battery components is manufactured or assembled in North America.
Generally, to determine the value of critical minerals and battery components, the white paper provides that manufacturers must use the arm's length price that was paid or would be paid by an unrelated purchaser using the transfer pricing principles of Internal Revenue Code Section 482.为了确定临界矿产品值,制造商可选择关键矿产品最终处理或回收步骤前后的任何日期,但该日期必须应用到电池内所有材料上。判定电池组件值时,制造商可选择电池组件最终制造或组装步骤前后的任何日期,但日期必须应用到电池内所有电池组件中万博体育app手机登录For each of the critical minerals and the battery component percentage calculations, the manufacturer may average the percentage calculations over a period of time with respect to vehicles from the same model line, plant, class, or some combination thereof for vehicles, the final assembly of which occurs in North America.
Critical Minerals Requirement
The section 30D credit requires that, for any EV placed in service in 2023 (after the publication of proposed guidance expected in March 2023), 40 percent of the value of the critical minerals in the EV's battery must be either extracted or processed in the United States or in any country with which the United States has a free trade agreement (FTA) in effect, or recycled in North America.万博体育app手机登录2024年增加50%,2025年增加60%,2026年增加70%,2026年后增加80%。
白皮书与第30D节相关介绍以下两大类采购链: Free Trade Agreement Guidance The FTA requirement has drawn substantial criticism from some European and Asian trading partners with significant EV manufacturing operations as being an unreasonable restriction on trade.U.S.万博体育app手机登录domestic manufacturers have also expressed general concerns regarding the availability of adequate supply of critical minerals from FTA partners. Yielding to those concerns, the white paper notes that the term "free trade agreement" is not defined in the Inflation Reduction Act. Accordingly, Treasury and the IRS expect to seek comment in the proposed guidance on what criteria should be used to identify free trade agreements for purposes of the critical mineral requirement. Proposed criteria may include whether an agreement reduces or eliminates trade barriers on a preferential basis, commits the parties to refrain from imposing new trade barriers, establishes high-standard disciplines in key areas affecting trade (such as core labor and environmental protections), and/or reduces or eliminates restrictions on exports or commits the parties to refrain from imposing such restrictions, including for the critical minerals contained in electric vehicle batteries. Application of these or other criteria may broaden the universe of countries available to source critical minerals beyond the list of 20 countries with which the United States currently has a comprehensive trade agreement. Battery Components Requirement The section 30D credit requires that 50 percent of the value of an EV's battery components must be manufactured or assembled in North America if the EV is placed in service in 2023 (after the publication of proposed guidance expected in March 2023).万博体育app手机登录This amount increases to 60% in 2024 and 2025, 70% in 2026, 80% in 2027, 90% in 2028, and 100% after 2028. It is anticipated that proposed guidance will provide the following four steps for certifying that an EV meets the battery component requirement: The white paper also provides preliminary sketches of the following terms, although Treasury indicates it will supply more through proposed definitions of these terms in later guidance: Treasury clarifies that the constituent materials of battery components would not themselves constitute battery components (specifically, because constituent materials are produced by processing or recycling critical minerals, rather than through manufacturing or assembly).Importantly, because the incremental value of a battery component is determined by reducing the value of such battery component only by the value of other battery components contained in such battery component, this means that "the incremental value of battery components would include [i.e., would not be reduced by] the value of constituent materials contained therein." In the percentages calculation, this approach will have the effect of assigning significant weight to the location where constituent materials are first manufactured or assembled into a battery component—thus incentivizing industry participants to locate those activities in North America. And there will be the greatest "bang-for-the-buck" for locating in North America the manufacturing or assembly of the battery components with the greatest combined value of constituent materials plus manufacturing value-add. Notice 2023-1, "Certain Definitions of Terms in Section 30D Clean Vehicle Credit" For the section 30D clean vehicle credit, the final assembly of a vehicle must occur within North America, and a manufacturer's suggested retail price cannot exceed the applicable limitation, which depends on vehicle classifications.货车、运动公用车和小卡车的适用限值为80 000元MSRP,任何其他车辆的适用限值为55,000元MSRP万博体育app手机登录The notice provides the following new definitions to clarify key terms that appear throughout section 30D. Final Assembly Section 30D(d)(5) defines "final assembly" as "the process by which a manufacturer produces a new clean vehicle at, or through the use of, a plant, factory, or other place from which the vehicle is delivered to a dealer or importer with all component parts necessary for the mechanical operation of the vehicle included with the vehicle, whether or not the component parts are permanently installed in or on the vehicle." The notice provides the following additional guidance, explaining that a taxpayer may rely on either of the indicators below to determine a vehicle's location of final assembly:
1232fll和 (B) 制造商建议每件附属件或可选设备在向经销商交付时实际附属于该汽车的零售交付价,该价不在根据15U.S.C.所述这类汽车价格内1232/f)(1),见15 U.S.C.1232/f)(2).通知解释称,如15 U.S.C.描述的那样,该信息贴在车挡风玻璃或侧窗标签上1232. 第30D(f)(11)(c)节后通知称车辆的“车辆分类”必须符合40CFR600.002中为货车、运动工具车和小卡车提供的规则和定义。
This blog is the third in a series, "The ABCs of the AJP."
An animating principle of President Biden's American Jobs Plan (AJP) is the urgency to address climate change. But a cross-current is competition with China. This comes through not as subtext, but as the stated purpose. According to the White House, "the President's plan will unify and mobilize the country to meet the great challenges of our time: the climate crisis and the ambitions of an autocratic China."
This dual focus on mitigating climate change and out-competing China is perhaps clearest in the AJP's proposal to "[c]reate jobs electrifying vehicles." Noting that "U.S.market share of plug-in electric vehicles (EV) sales is only one-third the size of the Chinese EV market," the AJP proposes "a $174 billion investment to win the EV market." The President proposes to invest in spurring automakers' development of U.S.-based supply chains for raw materials and parts.
Critically, the AJP proposes investments to create jobs for American workers manufacturing EV batteries here in the U.S. China currently accounts for the vast majority of the world's lithium-ion battery cell manufacturing and raw material refining, and shipped nearly half of the lithium-ion cells and packs imported to the U.S.2020年第四季度。美国电池制造能力正在提高,AJP设想的额外支持将有助于提高生产并加速国内EV成本的下降。
Beyond为气候目标投资,AJP也呼吁研发投资1800亿美元,同时注意到U.S只有少数大经济体之一,这些大经济体的公共研发投资在过去25年中以GDP百分比下降,中国正积极研发投资,使其现在在全球研发总开支中排名第二。 关于传统基础建设项目,AJP指出美国时时和预算提供基础建设延后同行,总体投资落后于中国。At上星期由美国总统拜登主办的气候问题领导人峰会unveiled its new Nationally Determined Contribution (NDC), upping the level of ambition, both at home and among other major emitters. But, despite getting top-billing, Chinese leader Xi Jingping, refrained from making any major new commitments. Instead, he restated last year's pledge for China's emissions to peak before 2030 and achieve carbon neutrality by 2060, adding merely that the nation would "strictly limit the increase in coal consumption," but not begin to "phase it down" until after 2025.
In 2020, in an effort to stimulate its economy in the wake of COVID-19, China commissioned 38.4 gigawatts (GW) of new coal-fired power generation capacity, more than three times the rest of the world's new additions combined, causing a net increase in global coal generation capacity, despite massive retirements elsewhere.
Yet in his remarks – titled "For Man and Nature: Building a Community of Life Together" – President Xi delivered a message of urgency to address climate, saying that, "the international community needs to come up with unprecedented ambition and action." He also welcomed the U.S.'s "return to the multilateral climate governance process," and said both nations were committed "to jointly advance global environmental governance."
While committing to participation in COP26 later this year in Glasgow, he emphasized that multilateralism necessarily requires a renewed commitment "to the principle of common but differentiated responsibilities," i.e., developing nations that contributed little to the accumulation of carbon dioxide in the atmosphere over first two hundred years since industrialization should bear a proportionately smaller share of the responsibility for the net societal costs to reduce emissions now.
The U.S.'s withdrawal from the Paris Agreement was predicated upon a narrative that the Paris framework's differentiated responsibilities put the U.S.美国工人处于劣势从属全球利益之下。 但有一种令人信服的反说明,即美国放弃在国际舞台上的领导权中共开发清洁能源经济时允许中国吃午餐。中国在全球EV电池市场中最大份额可能最能说明这一点 。
描述美国EV销售速度暗淡后,AJP相当认真地表示,“总统认为必须改变这一点。”只有时间才能判断AJP拟对EV制造、基础设施和交付客户的投资是否足以纠正不平衡问题。