Existing GST On Hybrid, EVs To Continue: Amitabh Kant

Amitabh Kant, former CEO of NITI Aayog, mentioned that the existing goods and services tax (GST) on hybrid and electric vehicles will continue for the foreseeable future. Speaking at an event organised by Mercedes-Benz Research and Development India (MBRDI), Kant said hybrid vehicles will continue to attract 48 per cent GST, while EVs will levy 5 per cent GST. This will be done to incentivise zero-emission technologies to push towards green mobility. 

“We’ve had a policy framework where the tax on electric vehicles is 5 per cent as compared to 48 per cent on hybrids, which we intend to continue over a long period,” Kant said. This will be a major issue for players like Maruti Suzuki, Toyota and Honda which have been lobbying to reduce taxes on hybrid vehicles. They have also argued that hybrid vehicles are cleaner compared to petrol powertrains and should also get incentives. On the other hand, Mahindra and Tata Motors have argued that zero-emission vehicles should be the only ones allowed to have concessions. 

The government is also pushing for battery manufacturing in India extensively, Kant said. He added, “Our policy is that we push for more and more electrification in mobility through all the policy levers available, including CAFE norms. So we will relentlessly push for India to become a green mobility destination.”

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He also added that India would miss out on the opportunity to become a world leader in EV manufacturing and to that extent, India needs to focus more on cleaner technologies.