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Encouraging buyers and sellers, GST on electric vehicles may be 5%
Posted on: 22/Jun/2019 12:52:08 PM
In order to encourage global manufacturers to invest in India’s shift towards e-vehicles, lower duties are to be levied. This shift/preference towards electrically operated vehicles is mainly in order to bring down the pollution levels.
This has been considered as that’s a high priority for the Narendra Modi government. Thus, the central government may cut the goods and services tax (GST) on electric vehicles to 5% from 12% to provide a stimulus to the sector.
This proposal will be taken up for review during the GST Council Meeting on 20th June. There is a definite proposal to cut the tax rates on EV among the other issues.
This incentive action has come into place following the request from the Punjab State Government to the Centre seeking a review of tax rates.
Counter-actions on slowdown on vehicle sales
The Punjab state government has sought new rates for automobiles, textiles, micro, small and medium enterprises (MSMEs) and real estate to provide a boost to the economy, which has slowed to the lowest in five years in FY19. In this regard, the state finance minister Manpreet Badal has suggested to the union finance minister and GST Council chairman Nirmala Sitharaman that tax rates for these sectors need to be lowered to address the slowdown.
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