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Government Could Announce Tax Sops For Electric Vehicles In 2018 Budget

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There is a chance that the government would dole out incentives to promote the sales of electric vehicles by considering to lower the GST and extending the tax benefits for the buyers. This is going to be seen in effect in the budget for 2018-19. The announcement could be expected as the government aims to have 100 percent electric vehicles for public transport and 40 percent for personal mobility by 2030.

Electric Cars

There are possibilities for the government to lower the Goods and Service Tax on the electric vehicles. A 12 percent slab exists at the present which would be brought down to 5 percent. There could even be income tax benefits to encourage the buyers to make these electric vehicles an interesting and easy option.

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The changes seem to be very likely as these changes would be revenue neutral exercise. The sales of these electric vehicles do not even reach one percent of the total sales of vehicles, including those of the two-wheelers and the commercial vehicles. The sales of the two-wheelers were around 17.58 million in 2016-17 and the passenger vehicles sold was around 3.04 million. Even the Power and New and Renewable Energy Minister had made a case for the tax incentives for electric mobility. The minister had even indicated that the government might even be trying to procure smaller cars under the e-mobility program.

The minister says that sedan type electric vehicles have already been procured. Now there is also the need of thinking about the smaller cars, according to the comment made by the minister. The Energy Efficient Services Ltd is procuring about 10,000 electric cars for the official use of the central government. The market for the electric cars is being given serious thoughts.

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