Electric vehicle makers welcome duty reduction

The auto industry on Saturday welcomed the reduction in GST on electric vehicles (EVs) and chargers, saying it will help in creating an ecosystem that will encourage faster mass adoption of eco-friendly mobility.

While terming the step as yet another bold move, the manufacturers, specially electric two-wheeler makers, sought similar reduction of 18 per cent GST on spare batteries, claiming it would help maintain low running cost of EVs over their lifetime.

"We welcome the GST Council's historic decision to reduce the GST on electric vehicles from 12 per cent to 5 per cent and on EV chargers from 18 per cent to 5 per cent.

"The tax benefit will help create an ecosystem that will encourage faster mass adoption of EVs in our society," Hyundai Motor India Ltd (HMIL) MD and CEO S S Kim said in a statement.

The company had recently launched its full electric SUV Kona priced at Rs 25.3 lakh.

"We are thankful to government of India for fulfilling their promise as this strategic decision by GST Council will further strengthen confidence of prospective buyers for electric mobility in future," he added.

Expressing similar sentiments, Mahindra & Mahindra Managing Director Pawan Goenka tweeted, "One more bold enabling step by GoI (government of India) to support EV movement. With the GST rates coming down the financial viability for 3W and even 4W for shared mobility becomes positive. Now let us just do it."
He, however, added, "While these are great steps for the future, short-term measures supporting the overall industry, also the luxury segment, are required by the government. All players are struggling with declining sales which in turn is leading to production cuts and may lead to job losses, too."