“To state the obvious, an EV made by autoworkers who choose to unionize does not make that vehicle any better for the environment,” Toyota Motor Corp. executives told House leaders.

Both House and Senate bills have sweeteners for cars assembled by organized labor, which would benefit General Motors, Ford and Stellantis, formerly Fiat Chrysler.

Eligibility requirements proposed by the House include limiting incentives based on a car-buyer‘s income and the price of the vehicle. Those measures could strip the market of billions of dollars in consumer incentives over the next decade, said Joe Britton, executive director of the Zero Emissions Transportation Association, which counts Tesla and Rivian among its members.

“If we want to drive adoption, we need a widely accessible tax credit,” Britton told POLITICO. “This isn’t about the driver and who should get the goodies. This is about reducing emissions, spurring economic development and improving public health.”

House Democrats want to continue giving EV buyers an existing $7,500 tax credit, and they’d add another $4,500 if the vehicle was assembled in the U.S. at union plants. A Senate bill proposes an extra $2,500 for union-assembled vehicles, and a separate $2,500 bonus for EVs assembled domestically.

United Auto Workers spokesperson Brian Rothenberg declined to comment specifically on whether proposals to reward only part of the market would slow adoption of electric vehicles.

He sent a written statement from union President Ray Curry, who said the proposal would help ensure taxpayer dollars don’t subsidize vehicles made by workers who are paid a substandard wage.

“We welcome all other auto companies to unionize and give U.S. workers the same union voice as they have in every other country where they build autos,” Curry said.

Rep. Dan Kildee (D-Mich.) led the House push to design tax breaks targeted to the middle class and boost incentives for vehicles assembled with unionized labor. The approach would ensure that taxpayer dollars don’t flow to the wealthy and subsidize luxury vehicles, he said.

An analysis by his office in August showed that nearly 98 percent of people who bought new vehicles in recent years would be eligible for credits in the House proposal. The credits are phased out for individuals earning $400,000 or more a year in adjusted gross income.

Electric cars, vans, SUVs and pickup trucks sold at certain price points also would be ineligible.

An incentive for the used car market, where most Americans buy their vehicles, would apply only to individuals earning less than $75,000 a year and to EVs that cost less than $25,000.

The Joint Committee on Taxation estimated the House plan would spend $16.9 billion on individual tax credits over a decade. By contrast, a package advanced out of the Senate Finance Committee in May, which doesn’t include income tests, would spend $31.5 billion during the same time period.

The House package has won endorsements from environmental groups such as the Sierra Club and clean-car advocates including Joel Levin, executive director of Plug In America.

“I understand why lawmakers don’t want EV credits to subsidize cars for rich people,” Levin said. “I think this is workable. The income caps are very high, and I appreciate the broader goals of the administration to support union jobs.”

Federal data shows the vast majority of tax credits currently are claimed by Americans earning $100,00 or more a year. Households in that income bracket also are more likely to identify as Asian or white.

Levin said that under the House and Senate proposals, most new luxury vehicles would be priced out of the tax credit. Provisions that make it easier for customers to take advantage of the benefits immediately on the sales floor, or fully claim them in tax returns, would expand access to lower-income individuals.

Gil Tal, director of the Plug-in Hybrid & Electric Vehicle Research Center at University of California, Davis, said income limits aren’t likely to affect sales one way or another because research shows that wealthy Americans will buy expensive cars without incentives.

The most effective way to grow the EV market, he said, would be to eliminate a 200,000 cap on the number of EVs an automaker can sell before tax credits lapse — a limit Tesla and General Motors Co. have already hit. Both the House and Senate proposals would lift the cap.

“This is very important,” Tal said. “This is a strong motivation for BMW to make cars that will compete with Tesla.”

Toyota, Honda Motor Corp., and other foreign automakers are more concerned about getting blocked out of extra subsidies because their U.S. plants aren’t unionized. They accused lawmakers of putting politics ahead of climate change.

“Biden has made his affection for UAW obvious,” said Cody Lusk, president and CEO of the American International Automobile Dealers Association, which represents 96,000 nameplates.

“But if I’m in South Carolina, and I want to buy a Volvo made in the U.S., I wouldn’t get the same benefits as someone who buys from GM in Michigan,” he said. “The $4,500 credit is a huge amount, and makes any non-union vehicles in a market non-competitive.”