Indian EV makers approve GST tax cut
The Society of Electric Vehicle Manufacturers (SMEV) on Saturday welcomed the reduction of the indirect GST (Goods and Services Tax) tax on electric vehicles to 5 percent, saying it is fully in line with the government's strategy to promote green vehicles, even though so far does not apply to spare batteries. SMEV CEO Sohinder Gill said the cut in GST would help narrow the gap between the prices of electric vehicles and internal combustion engine vehicles so that buyers can show interest in purchasing electric vehicles.
“The government has shown very clear intentions to promote electric vehicles lately, and the reduction of GST is one such move in line with a series of actions taken by the government in the last few months,” Gill said in a statement.
“We applaud the 7 percent cut in GST as it will close the gap between electric vehicles and IC (internal combustion) vehicles,” he added.
“The EV industry is currently expecting a corresponding 18 percent reduction in GST for spare batteries as this will help keep EV costs low throughout their lifespan,” it said in a statement.
On Saturday, a senior GST Council approved a decision to cut the electric vehicle tax rate from 12 percent to 5 percent starting August 1. He also lowered the GST on EV chargers from 18 percent to 5 percent.