Senate Republicans Plan to Moderate House IRA Tax Credit Rollbacks

House Republicans are pushing legislation to significantly scale back or eliminate clean energy tax credits established under the Inflation Reduction Act (IRA), which could lead to the early termination of consumer incentives for electric vehicles and home energy efficiency improvements. The House bill proposes ending most clean energy tax credits after 2025, several years earlier than the current 2032 sunset, with a limited extension for certain EVs from newer manufacturers. Senate Republicans, while generally supportive of revising the IRA tax credits, indicate a willingness to moderate the House's rollbacks, with some expressing concern that the proposed cuts may be too severe and could harm investment and jobs in the clean energy sector. Critics of the IRA argue that the existing production and investment tax credits have been extended repeatedly over decades without caps, and that the IRA's indefinite tax credits could lead to excessive government spending without achieving significant energy emission reductions. The GOP tax package aims to repeal about 60% of the IRA's tax credit costs, which some conservatives label as subsidies that have increased electricity costs and reduced grid reliability. Market reactions have included declines in solar energy stocks, reflecting investor uncertainty about the future of these incentives amid the legislative push to phase them out sooner.