California Allocates $135 Million for Electric Vehicle Rebates

California will offer rebates of $3,500 for new electric vehicles and $1,750 for used ones under a $135 million program included in the final state budget. The incentives take effect once the California Air Resources Board finalizes agreements with dealerships. Eligible buyers receive the discounts at purchase rather than claiming them later on tax returns.

Only first-time electric vehicle buyers qualify.

Senate Bill 168 requires buyers to attest they have not previously owned a zero-emission vehicle. The rebates represent 4% to 7% of the purchase price for most eligible buyers.

EV sales have declined while used EV sales rose more than 20% year over year in the first quarter of 2026, according to Cox Automotive data. Used electric vehicles now cost about the same as used gasoline-powered cars. A separate electric truck model priced under $25,000 is scheduled for release later this year, with deliveries beginning in 2026 and increasing in 2027.