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Old 26th July 2018, 13:00   #1
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Default Electric Vehicles set to get cheaper; GST on their batteries cut to 18%

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The GST Council, set up by the Indian Government has reduced the GST rate on lithium-ion batteries for electric cars from 28 per cent to 18 per cent.
10 per cent rate in reduction of GST on these batteries will help reduce the overall price of electric vehicles in India.

Prices for these few electric cars are set to be reduced by a notable percentage (estimated 8-10 percent) as the battery pack is the most expensive single component in all electric vehicles. That said, the price changes for both Mahindra and Tata Motors’ electric vehicles will not be immediate as in the past where GST on certain car segments prompted a quick response from automakers in India. This is mainly due to the fact that unlike completely built cars, prices of which can be changed on a short notice, components are usually bought well in advance (and in large quantities), which can cause prices to stay the same until the next batch of batteries is sourced.

Government has also reduced the GST on fuel cell vehicles from 28 percent to 12 percent.
NDTV Auto
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Last edited by johannskaria : 26th July 2018 at 13:01.
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Old 26th July 2018, 14:18   #2
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Default re: Electric Vehicles set to get cheaper; GST on their batteries cut to 18%

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This is unlikely to have a major impact on the price of the car. Batteries are an input to the car and thus companies would take all GST paid on inputs as input tax credit.
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Old 26th July 2018, 14:43   #3
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Default re: Electric Vehicles set to get cheaper; GST on their batteries cut to 18%

Are we missing the main point here? I'd ask only one question: Where are the EVs?

In reality, our automakers have only prioritized corporate greed over any environmentally friendly product offering. Outside of a decreasing number of start stop equipped vehicles, India is totally EV and hybrid barren.

Even the Camry Hybrid, which was a true success story, was shut down overnight with the advent of increased GST for Hybrid vehicles.
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Old 26th July 2018, 16:01   #4
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Default re: Electric Vehicles set to get cheaper; GST on their batteries cut to 18%

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Originally Posted by srh View Post
This is unlikely to have a major impact on the price of the car. Batteries are an input to the car and thus companies would take all GST paid on inputs as input tax credit.
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Originally Posted by Screwdriva View Post
Where are the EVs?

In reality, our automakers have only prioritized corporate greed over any environmentally friendly product offering. Outside of a decreasing number of start stop equipped vehicles, India is totally EV and hybrid barren.
This small measure opens up a lot of doors to make EV's accessible.
A battery leasing programme or even a swapping station or even a conversion programme and even making the said battery packs in India will be much more feasible IMHO.
If the lower inputs costs are not passed on to the end user, the directorate general of anti-profiteering (DG-AP) can also take action against the companies.

Changing policies (tax and otherwise), inadequate infrastructure, non-promotion of R&D, price sensitive market and inability to control the raw materials are not reassuring manufacturers in a positive way. So let's not jump to the conclusion that they are lazy bystanders. Even I wouldn't buy a substandard electric vehicle in this scenario. A tighter CAFE and emission norms would eventually push the companies towards better product mix in favor of EV's.
If only we had a brave startup like Tesla who disrupted how the game is played.
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Old 26th July 2018, 16:55   #5
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Default re: Electric Vehicles set to get cheaper; GST on their batteries cut to 18%

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If only we had a brave startup like Tesla who disrupted how the game is played.
You mean..like Reva?
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Old 26th July 2018, 17:10   #6
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Default re: Electric Vehicles set to get cheaper; GST on their batteries cut to 18%

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If the lower inputs costs are not passed on to the end user, the directorate general of anti-profiteering (DG-AP) can also take action against the companies.

.
There is no lowering of input cost in this case. Earlier it was higher GST on inputs coupled with higher input tax credit. Now it is lower GST on inputs coupled with lower input tax credit.
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