Central government may soon offer incentives to Tesla

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As you may know, Elon Musk just answered the most frequently asked question: why is it taking Tesla so long to get to India, via a tweet. Tesla has been in the spotlight as it prepares to launch its cars in India. In January, Tesla registered its factory in Bangalore, India’s Silicon Valley, and the public is thrilled. Tesla’s Model 3 test mule was also spotted. We all want Tesla to come to India ASAP, but as Musk said in his tweet, import duties are the highest in the world, making their cars expensive.

Government response

The central government has said it may consider lowering import duties and other incentives for Tesla, which is expected to start selling its electric vehicles in India soon. The move comes days after Tesla CEO Elon Musk raised concerns over the country’s high import duties. However, the consideration will only be taken into account if the company decides to manufacture its cars in the country, according to a senior government official quoted in an ET report. Tesla had approached the government earlier to demand a reduction on its cars, adding that they should be treated as electric vehicles and not as luxury cars.

Official statement

“We’ll be open to the idea, especially if they set up a manufacturing site here,” the senior official told ET. However, the manager made it clear that any decision in this area would apply to the entire industry and not just to one particular company.

Current government incentives

The Indian government is already working towards a greener future. By offering incentives to manufacturers of electric vehicles. One of the measures, for example, is reducing the Goods and Services Tax (GST) on electric vehicles from 12% to 5%. The government not only encouraged local production of electric vehicles, but also introduced tax benefits for people who buy electric cars. Under this program, buyers are eligible for an initial price reduction and an income tax deduction of 1.5 lakh on interest paid on loans taken for the purchase of electric vehicles. However, there is currently no incentive to sell or buy imported vehicles.

Tesla Model S Throw (1)

Tesla is asking for a 40% discount on fully assembled electric cars. The current rate is 60% for electric vehicles priced below $ 40,000 and 100% for any car above that price. It is important to note that India’s current import tariff structure does not distinguish between electric vehicles and internal combustion engines. With the growth of the electric vehicle industry, some changes are needed.


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