Electric vehicles will be cheaper than petrol cars in India, government has reduced GST from 18 to 5 percent

Rapid growth has been seen in the number of electric vehicles in India. The central and state governments have implemented several incentive programs that have increased EV adoption in the country. However, the Government of India has taken another brilliant decision to reduce the GST on battery packs from 18 percent to 5 percent. This means that 13 per cent is being deducted from GST for cars, whether they are equipped with batteries or not. Yes, at present, emphasis is being laid on both the manufacture and use of electric vehicles to reduce dependence on petrol everywhere in the country and the world. In such a situation, the government of the country keeps on taking steps to provide employment opportunities for the companies and facilities for the citizens at a cheap rate.

Production and demand of electric vehicles will increase
The purpose of giving such a huge concession on GST by the Government of India is to further increase the production and demand of electric vehicles in the country. The Indian Finance Ministry said in the statement that the decision to cut the GST rate was taken by the GST Council last month. EV manufacturers and by extension Indian customers will get the benefit of reduction in EV battery tax. The battery pack of an electric vehicle accounts for up to 50 percent of its cost.

The government has already taken the decision to reduce tax
Let us tell you that the government of the country has not taken this decision to cut GST for the first time. Yes, this is the second time that the Government of India is reducing the GST rate in the last 4 years. In 2018, it was reduced from 28 per cent to 18 per cent. This would have provided an incentive for EV manufacturers to set up shop in India. India has seen growth in both manufacturing and sales of electric vehicles in the last two years. This decision will further boost the market for renewable energy vehicles and lower carbon footprint. The trickle-down benefits of this decision could drive capacity and demand in the EV ecosystem in India.