The Energy Tax Act (Public Law 95-318) was a law passed by the U.S. Congress in 1978 as part of the National Energy Act. It was a response to the 1973 oil crisis and promoted fuel efficiency and renewable energy through taxes and tax credits.
This law gave an income tax credit to private residents who use solar, wind, or geothermal sources of energy. The credit is equal to 30% of the cost of the equipment up to $2000, as well as 20% of costs greater than $2000, up to a maximum of $10,000. There were also tax credits to businesses for renewable energy equipment, amounting to a maximum of 25% of the cost of the equipment.
The Energy Tax Act also put a "gas guzzler" tax on automobile manufacturers for each vehicle sold with gas mileage below a specified level. In 1980, the tax was $200 for a fuel efficiency of 14 to 15 miles per gallon , and was increased to $1800 in 1985. In 1880, the tax was $550 for fuel efficiencies of 13 mpg and below, and was changed in 1986 to $3,850 for ratings below 12.5 mpg. This "gas guzzler" tax only applied to cars under 6,000 pounds, which made SUVs and other large passenger cars exempt from this tax.
The renewable energy credits of this law were extended increased by the Crude Oil Windfall Profits Tax Act of 1980.
External Links
Summary of energy laws
Energy tax credits
Legislation affecting the renewable energy market
Congressional energy brief
