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Government planning to remove 15%cess on hybrid cars

Government planning to remove 15%cess on hybrid cars

Snapshot: Post-GST, an extra tax of 15 per cent was imposed on the hybrid cars over 28 per cent.

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The Government of India has recently intervened into the matter of extra tax of 15 per cent imposed on the hybrid cars post GST and has decided to withdraw it. The manufacturers of the hybrid cars have been constantly appealing to the GST council on this matter, who were firm at their decision of not making any alterations on the tax structure until the Government took the initiative to look into the matter. The top Indian body is planning to remove the extra 15 per cent cess that is attached to hybrid cars over the regular GST rate. According to the reports, the decision is expected to be implemented by the GST council in their next meeting on August 5, 2017.

Post-GST, an extra tax of 15 per cent was imposed on the hybrid cars over 28 per cent. This meant a total of 43 per cent tax was to be paid by the buyers. The result of which saw an increase in the price of the hybrid cars. Major automakers like Maruti Suzuki, Toyota, Mahindra, etc. who sells hybrid cars have been affected by lower sales. Price of Toyota’s hybrid cars have seen rise by Rs. 3.5 lakh to Rs. 5.2 lakh, while Maruti Suzuki Ciaz SHVS has recorded an increase in its price by Rs. 1 lakh.

The hybrid cars are environment-friendly. Hence, the drop in sales have also affected the Government’s initiative to “Go Green”. The Maruti Suzuki Ciaz SHVS is a great example of an environment friendly vehicle which is operated in both IC (internal combustion) engine as well as a battery-driven motor.

Now it is up to the discretion of the Government whether it decides to scrap the extra tax of 15 per cent imposed on this hybrid cars or goes with the current scheme of things.

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