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Reduction in GST for hybrid cars is being considered

Reduction in GST for hybrid cars is being considered
Pratheek Kunder Pratheek Kunder Monday 29 May 2017, 15:33 PM

When Finance Minister announced a 43 per cent GST for hybrid cars, many manufacturers were unhappy with the new policy. Subsequently, a few of them approached the GST council to request them to reconsider the new taxation for eco-friendly vehicles.

As per the GST, which will kick in on July 1st, hybrid cars will attract 28 per cent GST along with an additional cess of 15 per cent, thus increasing the total taxation to 43 per cent. This is an almost 13 per cent increase over the previous taxation and this is bound not to go down well with companies invested in hybrid car technologies. If the 43 per cent GST is applied, most of these manufacturers will hesitate to bring in their hybrid cars as the cost would increase astronomically, making it financially unviable for the customers.

Nitin Gadkari, Union Minster, Ministry of Roads, Transport and Highways, promised the manufacturers that he would speak with finance minister, Arun Jaitley about slashing the GST on hybrid cars. The government is committed towards reducing the air pollution in the country. However, this whopping increase in GST for hybrid cars doesn’t look to be in line with its strategy. Interestingly, fully electric cars will continue to be taxed at 12 per cent.

 

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