New Delhi: We need to look and examine the taxation concerns on batteries for four-wheelers and EV charging services, Tarun Kapoor, adviser to the Prime Minister, said on Tuesday. He was addressing the audience at an event organised by the Federation of Indian Chambers of Commerce & Industry (FICCI).
“We understand that taxation is a major issue. We have to look at all aspects, all levels so that the industry remains viable and in the long run, it remains competitive also,” he said.
“We probably need to look at the taxation on batteries. Additionally, if someone provides charging as a service, the GST becomes higher as it is treated as a service. This has already been flagged to the concerned authority. GST decisions go through the GST council. The government doesn’t take any direct decision on it,” Kapoor added.
At the event, Sulajja Firodia Motwani, founder and CEO of Kinetic Green requested the government to reduce the GST on batteries to 5%, from the current 18%. She also requested to bring down the GST on charging services to 5% as this will help in building the EV ecosystem. Motwani is also the EV Committee chair at FICCI.
The advisor to the PM highlighted that the EV sector is important for the government not only from the energy security point of view but also to make India a hub of EV manufacturing.
“On two-wheelers, we should have much higher targets and a complete replacement is what we have to look for in this segment. On three-wheelers as well, the switch has to be 100%, at least in some cities. On four-wheelers also, government support is very much there,” he said.
The two- and three-wheeler segments have been primarily leading the charge of EV adoption in the country. For the passenger vehicle segment, despite year-on-year growth, the electrification penetration has remained comparatively very low.
Further, Kapoor noted that the PM E-Drive scheme has a “huge outlay” for charging infrastructure. Compared to the FAME-II scheme, the outlay has been more than doubled to INR 2,000 crore, including a plan for the installation of 22,100 fast chargers for four-wheelers. However, the scheme does not extend any direct incentives for electric cars.
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