According to a media report, Maruti Suzuki wants the government of India to reduce the GST rate on hybrid and CNG cars.
Earlier this month, the government slashed the GST rate on electric vehicles (EVs) from 12% to 5%. However, hybrids and CNG powered cars are still in the 28% tax bracket.
According to R. C. Bhargava, Chairman, Maruti Suzuki, the government should also consider reducing the tax on hybrid and CNG vehicles, as it will take some time for mass acceptance of EVs. Besides, hybrid cars are said to be 25-30% more efficient than non-hybrid cars, which should help reduce oil imports.
Despite the tax cuts, the cost of EVs is expected to be higher compared to hybrids or CNG-powered cars and may not attract private buyers. The availability of charging infrastructure and range will also affect acceptance of EVs.
Source: Economic Times