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Government Golf Cart Distributors

Anthony Randazzo
October 19, 2009, 9:00am

There are loopholes in the law, and there are cracks in the frame work of the universe—this story might fall into the latter. With concerns about climate change mounting, the government has been stepping up interventionist measures. Well, as we noted back in February in the Taxpayer's Guide to the Stimulus, part of the stimulus was a tax break for those purchasing plug-in electric vehicles in an effort to cut back gas guzzling cars, trucks, and SUVs. There are a host of problems with these credits, but a new one has emerged. It turns out that the tax credit for buying electric vehicles applies too... wait for it... golf carts. From the WSJ:

The federal credit provides from $4,200 to $5,500 for the purchase of an electric vehicle, and when it is combined with similar incentive plans in many states the tax credits can pay for nearly the entire cost of a golf cart. Even in states that don't have their own tax rebate plans, the federal credit is generous enough to pay for half or even two-thirds of the average sticker price of a cart, which is typically in the range of $8,000 to $10,000. "The purchase of some models could be absolutely free," Roger Gaddis of Ada Electric Cars in Oklahoma said earlier this year. "Is that about the coolest thing you've ever heard?"

The golf-cart boom has followed an IRS ruling that golf carts qualify for the electric-car credit as long as they are also road worthy. These qualifying golf carts are essentially the same as normal golf carts save for adding some safety features, such as side and rearview mirrors and three-point seat belts. They typically can go 15 to 25 miles per hour.

In South Carolina, sales of these carts have been soaring as dealerships alert customers to Uncle Sam's giveaway. "The Golf Cart Man" in the Villages of Lady Lake, Florida is running a banner online ad that declares: "GET A FREE GOLF CART. Or make $2,000 doing absolutely nothing!"

Yes, our era of fiscal responsibility can get weirder. The Wall Street Journal also notes that some are stock piling golf carts as there is no limit to how many credits one person can use. This is ridiculousness is almost beyond words.

(Note: this critique is not to argue one way or another about the merits of the climate change arguments, but simply to comment on the role of government.)


Anthony Randazzo is Director of Economic Research


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