The Society of Indian Automobile Manufacturers (SIAM) may scrap a plan to recommend a Goods and Services Tax (GST) cut on strong or hybrid vehicles to the government, since some manufacturers are opposed to the move.
Electric vehicle (EV) manufacturers such as Hyundai Motor India, Tata Motors and Mahindra and Mahindra have resisted the move, Mint reported.
“The auto industry is divided on this issue of hybrid and electric vehicles and this development is a further indication of that. EV manufacturers have been lobbying the government to reduce tax and increase sops for developing India as a manufacturing hub for such vehicles. For hybrid vehicle makers, the high taxes are an impediment. Hence they will try to get the taxes reduced. Otherwise launching full hybrid will be difficult,” a source told the paper. Moneycontrol could not independently verify the story.
SIAM, Tata Motors and Hyundai had not responded to Mint’s requests for comment. A spokesperson of M&M declined to comment. The GST on EVs is currently 5 percent, while the tax rate for hybrid vehicles is 43 percent (28 percent GST plus cess).
There are various methods of meeting the national objectives of reducing fossil fuel imports, encouraging local manufacturing and job creation, mitigating carbon emissions, and reducing pollution, a spokesperson for Toyota Kirloskar Motor told Mint.
“Each of these options has its unique strengths, challenges and distinctive suitability for different vehicle segments. We believe that policy support should be merit based and extended to all technologies in proportion to their contribution to attaining the national objectives,” the spokesperson said.
Source from: https://www.moneycontrol.com/news/business/siam-may-scrap-plan-to-recommend-gst-cut-to-centre-report-6069801.html