Colorado Simplifies and Supports Tax Credits for NGVs to 2021
The U.S. State of Colorado has passed House Bill (HB) 16-1332, delivering substantial ongoing benefits
for the State’s natural gas vehicle industry. Signed off by Gov. John Hickenlooper on June 6, the
legislation (HB16-1332) provides important updates to simplify and expand existing tax credits for
taxpayers who purchase cars and trucks powered by clean-burning natural gas and other alternative
fuels. The bill goes into effect January 1, 2017.
According to the bill’s text, HB16-1332 concerns “modifications to the income tax credits for alternative
fuel motor vehicles, and, in connection therewith, fixing specified dollar amounts for the credits,
allowing the credit to be assigned to a financing entity, requiring vehicle identification number tracking
of the motor vehicle for which a credit is claimed, and making an appropriation.”
“Governor Hickenlooper and the Colorado legislature continue to recognize the strong benefits of using
clean-burning natural gas in transportation, and HB 16-1332 will put more natural gas vehicles on the
road,” said Matthew Godlewski, President of NGVAmerica. “This legislation will help continue the
transition to cleaner, low-cost, domestic natural gas for fleets and consumers across Colorado.”
The bill distinguishes between the purchase, conversion and lease of an alternative fuel vehicle. For the
period January 1, 2017 to December 31, 2019 it provides $5,000–$20,000 for the purchase or conversion
of an NGV, depending on whether it is a light, medium or heavy duty vehicle. The lease of an NGV will
provide $2,500–$10,000, again depending on the type of vehicle. A 20% reduction on the above figures
applies for 2020 and a 50% reduction on the above figures applies for 2021.
NGVAmerica explains that, in addition, the bill simplifies the income tax credits by eliminating the need
to calculate the incremental cost of the vehicle, and it allows buyers to claim the tax credit at the time of
purchase for a nominal administrative fee. These commonsense changes allow fleets and consumers to
quickly understand and take advantage of the value of the credits.
“Simplifying alternative fuel vehicle credits is an important step to ensure taxpayers can take advantage
of the significant cost savings,” said Godlewski. “NGVAmerica commends Colorado lawmakers for their
continued strong support of clean transportation and alternative fuels.”