Congress reduces tax break for new car buyers
A proposed tax break for new car buyers has been downsized by Congress.
The compromise version of the ginormous economic stimulus bill includes a Senate-approved provision that would allow consumers to claim a federal income tax deduction for sales and excise taxes paid on new vehicle purchases.
However, the compromise worked out by House and Senate negotiators deletes a provision that would have made interest on new-vehicle loans deductible as well.
Under the new version, a family could save between $300 and $600 on a new car, according to a statement released by Sen. Barbara Mikulski (D-Md.), who sponsored the original tax break. Mikulski had said her original version (read the details here) would have saved $1,500 on a $25,000 new car purchase.
