Maruti Suzuki pitches for tax support for hybrid vehicles
The Hindu
Shashank Srivastava, Senior Executive Director, Marketing & Sales, Maruti Suzuki said that domestic passenger vehicle sales is likely to see the best ever sales this year of almost 4 million units or 40 lakh units, despite the semiconductor shortage
Maruti Suzuki on Monday pitched for a policy framework that was balanced and provided more incentives, especially on the tax front, for hybrid vehicles as well instead of being overly tilted in favour of electric vehicles.
“Yes. There is a disadvantage for hybrid vehicles against EVs [due to the difference in GST rates],” Shashank Srivastava, Senior Executive Director, Marketing & Sales, Maruti Suzuki, said
“Therefore, we think there has to be, on the tax front, some support for the hybrids as well.”
Currently, the tax rate applicable on electric vehicles in India is 5%, while the same for small hybrid vehicles is 28% and for large hybrid vehicles is 43%. For the internal combustion engine (ICE) vehicles, the tax rate is 29% for small vehicles and 45% for large vehicles.
“...it can not be a situation where all the benefits of GST accrue to only one type of powertrain. If hybrids are running 40% or 60% of the time on electric power, then there has to be some sort of support or incentive for promoting these vehicles because these are environment friendly,” Mr. Srivastava added.
A hybrid vehicle gives 35% improved vehicle efficiency compared to an ICE vehicle.
C.V. Raman, Chief Technical Officer (Engineering) at Maruti Suzuki India added that a tax differential of 2% between ICE vehicles and hybrid vehicles will not really change the equation.