Tax Incentives For Hybrid Cars

Due to world political pressures around the world to reduce greenhouse emissions, President Bush signed an agreement in 2005 to provide huge tax relief to hybrid car buyers. The tax incentive varies by model and are based on two factors

1. How fuel efficient the hybrid car is compared to a conventional car in 2002 with the same weight class.

2. How much gasoline the hybrid car can save in its lifetime compared with an equivalent conventional car

For example, a Honda Accord hybrid car have reduced tax credits of $600 while a Toyota Prius has a tax credit of $3150. Do note that the tax credits do expire after 2010 for most hybrid cars.

Hybrid car manufacturers are continually researching for more ways to reduce fuel consumption and better fuel efficiency. Also as more hybrid cars are being adopted, the cost of hybrid cars will reduce making it more affordable for everyone.