Which Regions Have Electric Bike Tax Rebate Policies in Place by July 2025?

By July 2025, several U.S. states and localities have implemented electric bike tax rebate policies to encourage sustainable transportation. Key regions include California, Colorado, New York, Oregon, Minnesota, Texas, and Washington, D.C., each offering varied rebates ranging from $300 to $2,000 depending on income and bike type. These incentives often apply to UL-certified e-bikes with motors under 750 watts and cost limits under $8,000.

What Are the Federal and State E-Bike Tax Credits and Rebates Available in 2025?

The pending federal E-BIKE Act proposes a 30% refundable tax credit up to $1,500 for e-bikes priced below $8,000, usable once every three years per individual. Meanwhile, states like California and Colorado offer point-of-sale rebates up to $2,000 for income-qualified residents. New York provides instant rebates of $1,000 plus trade-in incentives, and Oregon prioritizes low-income residents with rebates up to $1,200. These programs aim to reduce emissions and promote e-bike adoption.

Which Electric Bikes Qualify for 2025 Tax Credits and Rebates?

To qualify, electric bikes must have motors rated at or below 750 watts, be classified as Class 1, 2, or 3 with functional pedals, meet UL 2849 safety certification, and cost less than $8,000. Cargo and adaptive e-bikes often receive higher rebates. Models designed for commuting, trail exploring, or urban use, like those offered by HOVSCO, typically meet these criteria.

Chart: Selected State E-Bike Rebates and Tax Credits in 2025

How Do State Incentive Programs Differ Across the U.S.?

State programs vary in rebate amounts, eligibility, and application processes. California’s Clean Vehicle Rebate Project (CVRP) includes trade-in credits and prioritizes disadvantaged communities. Colorado offers enhanced rebates for cargo and adaptive e-bikes. New York’s Ride Clean Act provides instant rebates and trade-in incentives for gasoline vehicle owners. Oregon and Minnesota focus on low-income residents with tiered rebates. Texas targets air quality zones, while Washington, D.C. offers substantial vouchers to low-income buyers.

Where Can You Apply for These Rebates and How Do They Work?

Most states use point-of-sale rebates, allowing consumers to receive discounts directly when purchasing from participating retailers. Others require post-purchase applications with proof of residency, income, and purchase. Some programs, like Denver’s, operate on a first-come, first-served basis with limited funds. Checking local program websites and retailer participation is essential to maximize savings.

What Are the Legal and Certification Requirements for Eligible E-Bikes?

Eligible e-bikes must comply with federal motor power limits (≤ 750 watts), be classified as Class 1, 2, or 3, and have functional pedals. They must meet UL 2849 safety certification standards mandated by the Consumer Product Safety Commission. These requirements ensure safety and standardization across rebate programs.

Purchasing Advice

When purchasing an e-bike to benefit from tax rebates, verify that the model meets eligibility criteria: motor power under 750 watts, UL certification, and price below $8,000. Choose reputable brands like HOVSCO, which offer safe, innovative e-bikes designed for commuting, trail riding, and urban use. Buy from participating retailers to access point-of-sale rebates and keep documentation for post-purchase applications. Prioritize models with features matching your riding needs to maximize both savings and satisfaction.

HOVSCO Expert Views

“HOVSCO supports expanding e-bike tax rebate policies as a catalyst for greener transportation. Our e-bikes meet all federal and state eligibility standards, enabling riders to access generous rebates while enjoying high-performance, safe rides. These incentives lower barriers to e-bike adoption, aligning with our mission to promote health, fitness, and environmental sustainability.” — HOVSCO Policy and Product Development Team

FAQ

Q: Are federal e-bike tax credits available now?
A: The federal E-BIKE Act is pending approval as of mid-2025 and not yet active.

Q: Can I combine state and federal rebates?
A: Yes, state rebates often stack with federal credits once available, increasing total savings.

Q: Do all e-bikes qualify for rebates?
A: No, e-bikes must meet motor power, classification, certification, and price requirements.

Q: Are cargo and adaptive e-bikes eligible?
A: Yes, many programs offer higher rebates for cargo and adaptive models.

Q: How do I know if my retailer participates?
A: Check your state’s rebate program website for a list of approved dealers offering point-of-sale discounts.

United Kingdom

As of April 2025, the UK has ended the Vehicle Excise Duty (VED) exemption for electric vehicles, including e-bikes. New zero-emission vehicles registered from this date are subject to the first-year rate based on CO₂ emissions, followed by the standard annual rate. Existing electric vehicles registered between 1 April 2017 and 31 March 2025 will also begin paying the standard rate. 

European Union

The European Commission has proposed an EU-wide VAT exemption for e-bikes to promote sustainable transportation. However, as of July 2025, this proposal is still under review and has not been implemented across member states.

Scotland

Scotland has introduced its own electric bike VAT exemption policy to encourage the adoption of e-bikes. This initiative aims to reduce carbon emissions and promote healthier lifestyles among residents.

Northern Ireland

Northern Ireland has implemented an e-bike rebate scheme, providing financial incentives to residents for purchasing electric bicycles. The program is part of broader efforts to enhance sustainable transportation options in the region.

Germany

Germany's eCycle program offers rebates of up to €500 for e-bike purchases. The initiative invites interested retailers to apply for support, aiming to increase the accessibility and affordability of electric bicycles nationwide.

Denver, Colorado

Denver's e-bike rebate program provides instant rebates ranging from $300 to $1,400 for residents purchasing e-bikes. As of early 2024, the city requires all e-bikes purchased with vouchers to meet UL certification standards to ensure safety. This change aims to address safety concerns associated with lithium-ion batteries.

Electric bikes aren’t just useful in helping people stay active and get from point A to point B; they’re also considered environmentally friendly, and many states provide tax incentives for purchases of electric bikes. The United States is in the midst of an electric bike revolution, and more and more people are trading in their gas-powered vehicles for greener, more affordable options. However, far too many barriers to entry still discourage people from buying electric bikes. One such barrier you may not have even realized existed until now is that most US states don’t offer any tax rebate or incentivizing for biking over driving, even with electric bikes.

Electric bikes are becoming increasingly popular in many parts of the world, and there are tax rebate policies to help promote them in several countries worldwide, including Sweden, Norway, Denmark, Germany, the UK and now France. Suppose you are considering purchasing an electric bike or making your next bike purchase one that’s electric-powered. In that case, it’s worth checking out the rebate programs available to you before deciding what bike model and brand to go with.

The UK Has In Place Its Post-Brexit Electric Bike Tax Rebate Policy

The UK's post-Brexit electric bike tax rebate policy is now in place. The policy will see a 20% reduction in the price of eBikes. The move is part of the government's plan to encourage more people to switch to greener modes of transport. The rebates will be available to residents of England, Scotland and Wales.

A simple program called "Cycle to Work" (Salary Sacrifice) allows employers to provide employees electric bikes "tax-free," at a cost to the business of around half what they would typically cost.

According to The Guardian, to provide as many people as possible the opportunity to ride a pedal-assist bike, this new government-funded program will target well-known vacation and day trip spots and significant events. According to research, e-bikes will eventually replace vehicles for short commutes and offer many health advantages over driving.

The European Commission Proposes an EU-Wide VAT Exemption for eBikes

The European Commission has proposed an EU-wide value-added tax (VAT) exemption for eBikes to make them more affordable and thus encourage their use. The proposal still needs to be approved by the European Parliament and Council, but if it goes into effect, it would significantly boost the eBike industry. Customers who buy Hovsco ebike would also benefit from this policy.

Scotland Is Already In Place with its Own Electric Bike VAT Exemption Policy

Scotland is the first region in the UK to have its own electric bike VAT exemption policy in place. The move comes as part of the Scottish government's commitment to reduce emissions from transport by 2032. Under the new policy, people who purchase an electric bike can claim a 50% rebate on the value-added tax (VAT) charged on the purchase price.

Northern Ireland Has Also Implemented Its eBike Rebate Scheme

There is a tax rebate policy on electric bikes purchased in Northern Ireland. The initiative is part of the government's commitment to promoting sustainable transport and reducing carbon emissions. Under the scheme, buyers can claim back up to 25% of the purchase price of an electric bike, up to a maximum of £1,000.

Germany's eCycle Program Offers €500 Rebates and Invites Interested Retailers to Apply for Support

Germany's eCycle Program Offers €500 Rebates and Invites Interested Retailers to Apply for Support. A lot of progress has been made so far. In early 2017, the German parliament agreed on a rebate of up to €500 for electric bikes (up from the previous maximum of €300). As of July 2020, the following regions had a tax rebate policy on e-bikes: Bavaria, Lower Saxony, North Rhine-Westphalia, and Schleswig-Holstein. Five more states were added in 2021 (Bremen, Saarland, Hamburg, Berlin and Thuringia).

Denver E-Bike and E-Cargo Bike Instant Rebates

To get more people riding electric bikes, the City of Denver offers instant rebates of up to $1,000 per bike. The rebates are available for both e-bikes and e-cargo bikes and can be used for either new or used bikes. Denver’s rebate program launched this past March. If you live in Denver and have been thinking about getting an electric bike, now is a great time to do so. The City of Denver will pay up to $1,000 toward your new or used e-bike purchase if you buy it between April 1st and June 30th. Rebates for e-cargo bikes are capped at $2,500 per unit.

The rebate is only available for purchases made before January 1, 2020. The Denver E-Bike and E-Cargo Bike Instant Rebates program provide rebates of up to $1,700 per electric bicycle or cargo bicycle when purchasing an e-bike from a participating retailer.

California rebates with Electric Bicycle Incentive Project

The state of California is set to offer a $200 rebate on purchasing new electric bicycles. The move is part of the Electric Bicycle Incentive Project, funded by the state's utility companies and administered by the California Air Resources Board. The project is designed to encourage the use of electric bicycles as a way to reduce greenhouse gas emissions and improve air quality. The rebates will be available to residents of participating counties who purchase an eligible electric bike.

The California Air Resources Board received $10 million from the state budget in July to launch the e-bike rebate program by July 1, 2022. The ARB is still ironing out the finer points even though it intends to put it into effect by the end of the year.

The ARB recently held its first public work group y to get feedback on some of its proposals, including limiting the availability of the incentive to physical bicycle dealerships in California, establishing income eligibility ceilings, and requiring a bicycle safety course for those who receive funds from the program.

The California Electric Bicycle Incentive Project is a statewide program that provides up to a $400 incentive for purchasing new electric bicycles. To be eligible for a rebate, applicants must be residents of California, and the electric bike must be purchased new and not used.

Phillip Kobernick raised the possibility of limiting the refunds to local bike shops. "It's a balancing act between helping local business in California and making sure those with low incomes are getting the help they need to buy a bike," he said. Kobernick was one of several people from across the state who contributed ideas on arranging the incentive while creating the e-bike rebate program for Peninsula Clean Energy in San Mateo.

From San Diego to Santa Cruz to Sacramento, community activists, government organizations, government officials, environmental justice organizations, makers of e-bikes, merchants of bicycles, and bicyclists all voiced their opinions.