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GST for Electric Car Batteries Slashed from 28 to 18 Percent

GST for Electric Car Batteries Slashed from 28 to 18 Percent

Snapshot: GST Council has reduced the tax for EV batteries by 10% resulting in hope for cheaper electric vehicles in India.

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As Indian government is keen to introduce the zero emission mobility in the country in next decade, it has taken a step to reduce the burden of tax from the automakers who build electric vehicles. GST for the electric car batteries have been reduced to 18% from previous 28% slab. Thanks to this 10% tax slash, electric vehicles in India are expected to be cheaper in coming days.

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It has been proposed many times by authorities that government should reduce the tax slab for the electric vehicles. Presently, the electric vehicles in India enjoy 12% GST compared to the 28% slapped on the regular vehicles. Along with that, the reduced 18% tax for the EV batteries will certainly help automakers in their drive towards zero emission vehicles.

Speaking about the electric vehicles in India, presently there are several electric two-wheelers here, but not many fully electric cars. While Mahindra sells the e2o Plus and e-Verito, Tata Motors has built the Tiago EV and Tigor EV. However, Tata is yet to start the mass production of its two EVs for the general customers.

As Indian automobile industry relies on the imported batteries, pricing for the EVs are pretty high. This doesn’t help in the growth of the zero emission vehicles. With this reduced tax and more local production of lithium-ion batteries, the scenario of the EVs in India is expected to be brighter in coming days.

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