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Thought Leader Uncategorized Law & Public Policy

Preparing for our electric, autonomous future

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Eric Tanenblatt, leader of the Public Policy and Regulation practice, Dentons

Eric Tanenblatt, Dentons

By Eric Tanenblatt

Truly autonomous vehicles—that is, those not requiring drivers—will be freely navigating public roads in Georgia this year, marking the culmination of nearly two centuries of research and development of internal combustion engines and machine learning.

Finally, for the first time in the history of the gasoline-powered engines, these recent developments in artificial intelligence means that the automobile is worthy of the automatic moniker. It’s ironic, then, that this long-awaited auto-mobile won’t be gasoline-powered.

You can take it to the bank: autonomous vehicles will be fuel-alternative. And that’s a good thing not only for the environment (just imagine the environmental footprint of a gasoline-powered robocab that’s constantly in operation!), but also our economy (fuel-alternative vehicles are powered primarily through domestic sources like coal, natural gas, and nuclear energy).

Despite this certainty—ask anyone in Detroit or Silicon Valley and they’ll tell you the same thing—Georgia’s tax code is written in such a way as to delay this autonomous future by discouraging the purchase of electric vehicles.

But it wasn’t always that way.

In June 2015, a month before the state abandoned its pioneering $5,000 tax credit on electric vehicles and created instead a new registration fee that applied only to electric vehicles, there were nearly 1,300 electric vehicles sold in Georgia. Within the space of just two months that number had fallen to 97.

According to registration figures from state authorities, electric vehicle ownership in the state has plummeted by a whopping 85 percent since the tax rewrite.

Before the legislature repealed the tax credit, Georgia claimed the second-highest share of electric vehicle ownership in the nation. Today, we’re among the lowest. If that dynamic persists, the autonomous vehicle revolution will leave Georgia in the dust.

There is a nascent effort underway in the General Assembly to make sure this possible future doesn’t come to pass. At least one bill has been introduced to reintroduce the credit.

Specifically, the bill would carve out a $2,500 electric vehicle tax credit with the stipulation that the credit is applicable only to the purchase of plug-in vehicles valued less than $60,000; that credit reservoir would run out annually after more than 4,000 cars were sold; and that taxpayers may exercise the credit only once every three years.

Proposals such as this are thoughtful compromises that balances the imperative to stimulate electric vehicle sales and leases in Georgia while keeping our state’s expenses restrained in this era of austerity. The effort represents smart policy that would strategically position Georgia as an innovative state ready not only for electric vehicles but autonomous ones, too.

Georgia has one of the most welcoming testing regimes for autonomous vehicles in the country, in part because leadership in the General Assembly understands how transformative they could prove for our traffic-plagued region. But the truth is that our autonomous vehicle laws won’t be enough to bring them to the state in significant numbers—not when other laws punish them in a roundabout manner.

Autonomous, electric vehicles are the future, but our tax code is tethering us to the past.

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