Article author:
Associated Press
BRUSSELS (AP) — The European Union said Thursday that a new U.S. tax credit plan aimed at encouraging Americans to buy electric cars would discriminate against European producers and end the World Trade Organization's He expressed concern about violating the rules.
Under the Inflation Reduction Act, which is nearing final approval by the US Congress, tax credits of up to $7,500 may be granted to lower the cost of electric vehicles. To qualify, the bill requires electric vehicles to have batteries manufactured in North America using minerals mined or recycled in North America.
"The European Union is deeply concerned about this new potential transatlantic trade barrier," said Miriam Garcia Ferrer, spokeswoman for the European Commission. "We believe it is discriminatory and discriminates against foreign producers in relation to U.S. producers."
"Of course, this contradicts her WTO means," she said. The Commission is her EU executive branch and part of its responsibility is to represent her 27 countries in the bloc in conducting trade with the outside world.
The Commission agrees that tax credits are "a key incentive to drive demand for electric vehicles" and ultimately help reduce greenhouse gas emissions. "But we need to make sure the measures introduced are fair," the spokesperson said.
The thinking behind the US requirements is to encourage domestic manufacturing and mining, build a robust battery supply chain in North America, and avoid potentially disruptive foreign supply. It's about reducing the industry's dependence on the chain.
China currently has a monopoly on the production of lithium and other minerals used in the production of EV batteries. The Democratic Republic of the Congo is the world's leading producer of cobalt, another component of EV batteries.
However, the Commission is deeply concerned about the domestic content and assembly requirements of the tax credit scheme, which only favors certain mineral-rich countries, which are exported to the United States. alleges that it damages EU products manufactured by
According to the Commission, EU subsidies are available to domestic and foreign producers.
—— Follow all AP stories on climate change at
https://apnews.com/hub/climate-and-environment
