Govt slashes GST rate on EVs from 12% to 5%
The GST Council also cut the tax rate on electric vehicle chargers from 18% to 5%, a move that’s going to provide a great impetus to the EV industry
July 27, 2019
At its 36th
meeting, the Goods and Services Tax (GST) Council slashed the GST on electric vehicles from 12 percent to 5 percent on Saturday. Additionally, the Council also reduced the tax rate on EV chargers from 18 percent to 5 percent, a move that’s going to provide a great impetus to the emerging EV industry in India.
Hiring of EV buses exempted from GST
“Hiring of electric buses (with a carrying capacity of more than 12 passengers) by local authorities to be exempted from GST,” the government said in a press release. The new rates are going to be effective from August 1.
Govt making way for EVs in a big way
The government seems to be following a two-pronged approach to prepare the market for the roll-out of EVs and also wean the economy away from fossil fuels. According to sources, along with introducing tax cuts for EVs, the government is also planning to increase the registration charges exponentially for petrol and diesel vehicles.
“Punjab, Delhi and West Bengal were not fully in support of EV rate-cut proposals over concerns of a loss of revenue,” a government official said.
The move comes as manufacturers have been asking the government for a cut in GST rate on electric vehicles for quite some time now. Finance Minister Nirmala Sitharaman, too, has announced sops for income taxpayers who take loans for electric vehicles.
The government also extended the last date for filing intimation to avail the option of payment of tax in form GST CMP-02 from July 31 to September 30 and filing of details of self-assessed tax in form GST CMP-08 for the first quarter from July 31 to August 31.