Texas Imposes New Tax on Electric Vehicles

Texans who own or buy electric vehicles will see their registration costs jump. Here's what you need to know.

Welcome to Texas sign for electric vehicle tax
(Image credit: Allard Schager/Getty Images)

Purchasing an electric vehicle can result in a potential money-saving federal EV tax credit, but as of September 1, Texas residents have to pay more to own an electric vehicle in the state. Under a new EV law signed by Gov. Greg Abbott, Texans who own or purchase electric vehicles will pay up to $400 to register their “clean vehicles” and $200 every time they renew their registrations. The measure is expected to generate about $38 million in new revenue.

Proponents of the Texas electric vehicle tax say that it will ensure Texans contribute to highway expenses, which the state pays for using state gas tax revenue. (There are reportedly about 200,000 electric vehicles in the state.)

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Katelyn Washington
Tax Writer

Katelyn has more than 6 years’ experience working in tax and finance. While she specializes in tax content, Katelyn has also written for digital publications on topics including insurance, retirement and financial planning and has had financial advice commissioned by national print publications. She believes that knowledge is the key to success and enjoys helping others reach their goals by providing content that educates and informs.