government is considering an import duty slash on electric vehicles (EVs),
according to two senior government officials. This news comes after Tesla Inc appealed
for a cut.
As per the
sources, the government is conducting discussions to slash the tax rates from
60% to 40% for imported EVs costing less than $40,000, including the vehicle's
cost, insurance and freight. For EVs costing more than $40,000, the government
might cut rates to 60% from 100%.
Modi, Finance Minister, Commerce Minister and Niti Aayog will decide after
consulting all stakeholders.
mentioned that reducing EVs import duties will make them affordable for people
and improve sales. This argument started a public debate in the auto industry
as it might contradict India’s move to increase domestic manufacturing.
said that the government might be in favour of a cut if Tesla can provide
benefit to the domestic economy by manufacturing locally or at least giving a
timeline for the same.
Elon Musk, CEO,
Tesla had tweeted that a local factory in India was quite likely if the company
was successful with imports.
Tata Motors and
Ola, which produce affordable electric cars and scooters, are against this
proposed cut of import duties.
Source – Reuters