India will retain its current tax structure for electric and hybrid vehicles for an extended period, the government's G20 Sherpa, Amitabh Kant, announced on Tuesday. Electric cars will continue to be taxed at a rate of 5%, while hybrid cars will face a significantly higher tax of 48%.

This decision comes amidst growing pressure from major car manufacturers like Maruti Suzuki India and Toyota Kirloskar Motor to lower the tax burden on hybrid cars. However, the government has reiterated its focus on promoting electric mobility and battery manufacturing in India.

"Our policy framework is to provide a significant tax advantage to electric vehicles compared to hybrid cars. This incentive is intended to encourage the adoption of electric vehicles and boost the development of the domestic EV ecosystem," Kant said during a panel discussion at Mercedes-Benz Sustainability Dialogue India 2024.

The government's stance aligns with its broader goal of achieving carbon neutrality by 2070. While some automakers argue that hybrid cars can play a crucial role in reducing emissions, others contend that a full commitment to electric vehicles is essential for achieving India's decarbonisation targets.

Hybrid cars in India are currently subject to an effective tax rate of around 48%, which includes the Goods and Services Tax (GST) and other applicable levies. Electric cars, on the other hand, benefit from a lower GST rate of 5%. While the government has considered proposals to reduce the GST rate on hybrid cars, it has ultimately decided to maintain the current tax structure.

Kant also highlighted the government's efforts to promote electric mobility through various initiatives, including the Faster Adoption and Manufacturing of Electric Vehicles (FAME) scheme and the Production Linked Incentive (PLI) scheme. These schemes provide financial incentives to electric vehicle manufacturers and support the development of charging infrastructure across the country.

"We are committed to creating a conducive environment for the growth of the electric vehicle industry in India," Kant said. "By providing tax incentives, promoting charging infrastructure, and investing in renewable energy, we aim to accelerate the adoption of electric vehicles and reduce our carbon footprint."

The government's decision to maintain higher taxes on hybrid cars has sparked debate among automakers. While some support the government's focus on electric vehicles, others argue that hybrid cars can serve as a bridge to a fully electrified future. The ongoing discussions highlight the complex challenges and opportunities presented by India's transition to electric mobility. 
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India will retain its current tax structure for electric and hybrid vehicles for an extended period, the government's G20 Sherpa, Amitabh Kant, announced on Tuesday.

India will retain its current tax structure for electric and hybrid vehicles for an extended period, the government's G20 Sherpa, Amitabh Kant, announced on Tuesday. Electric cars will continue to be taxed at a rate of 5%, while hybrid cars will face a significantly higher tax of 48%. This decision comes amidst growing pressure from major car manufacturers like Maruti Suzuki India and Toyota Kirloskar Motor to lower the tax burden on hybrid cars. However, the government has reiterated its focus on promoting electric mobility and battery manufacturing in India. "Our policy framework is to provide a significant tax advantage to electric vehicles compared to hybrid cars. This incentive is intended to encourage the adoption of electric vehicles and boost the development of the domestic EV ecosystem," Kant said during a panel discussion at Mercedes-Benz Sustainability Dialogue India 2024. The government's stance aligns with its broader goal of achieving carbon neutrality by 2070. While some automakers argue that hybrid cars can play a crucial role in reducing emissions, others contend that a full commitment to electric vehicles is essential for achieving India's decarbonisation targets. Hybrid cars in India are currently subject to an effective tax rate of around 48%, which includes the Goods and Services Tax (GST) and other applicable levies. Electric cars, on the other hand, benefit from a lower GST rate of 5%. While the government has considered proposals to reduce the GST rate on hybrid cars, it has ultimately decided to maintain the current tax structure. Kant also highlighted the government's efforts to promote electric mobility through various initiatives, including the Faster Adoption and Manufacturing of Electric Vehicles (FAME) scheme and the Production Linked Incentive (PLI) scheme. These schemes provide financial incentives to electric vehicle manufacturers and support the development of charging infrastructure across the country. "We are committed to creating a conducive environment for the growth of the electric vehicle industry in India," Kant said. "By providing tax incentives, promoting charging infrastructure, and investing in renewable energy, we aim to accelerate the adoption of electric vehicles and reduce our carbon footprint." The government's decision to maintain higher taxes on hybrid cars has sparked debate among automakers. While some support the government's focus on electric vehicles, others argue that hybrid cars can serve as a bridge to a fully electrified future. The ongoing discussions highlight the complex challenges and opportunities presented by India's transition to electric mobility.

Government to maintain 48% tax on hybrid cars and 5% on EVs

Republican presidential candidate Donald Trump recently indicated a potential shift in U.S. electric vehicle (EV) policy if he returns to the White House. Trump, known for his scepticism towards green energy incentives, suggested he might end the $7,500 tax credit for EV purchases. This announcement could have significant implications for the burgeoning EV market in the United States, particularly for automakers who have benefited from these subsidies.

Questioning the EV Tax Credit: A Possible Reversal?

Trump's reservations about the EV tax credit are not new. During his previous term, he attempted to repeal the incentive, a move that was ultimately reversed under President Joe Biden’s administration, which expanded the credit in 2022. Speaking to Reuters after a campaign event in York, Pennsylvania, Trump expressed his general disapproval of tax credits and incentives. "Tax credits and tax incentives are not generally a very good thing," Trump stated, hinting at a possible rollback of these benefits if he is re-elected.

The EV tax credit has played a crucial role in promoting the adoption of electric vehicles by making them more affordable for consumers. However, Trump’s comments suggest a preference for a more market-driven approach to the automotive industry. "I'm not making any final decisions on it," he said, adding that while he supports the concept of electric cars, he remains a fan of traditional gasoline-powered vehicles and hybrids as well.

Elon Musk in a Trump Administration?

In a surprising turn, Trump also indicated his openness to involving Tesla CEO Elon Musk in his administration. Praising Musk's intelligence and innovative spirit, Trump said, "He's a very smart guy. I certainly would, if he would do it, I certainly would. He's a brilliant guy." This potential collaboration could lead to interesting dynamics in U.S. technology and energy policies, given Musk's influence in the EV sector and beyond.

Musk, who recently endorsed Trump in the U.S. presidential race, did not immediately respond to requests for comment on the possibility of joining a Trump administration. If appointed to a cabinet or advisory role, Musk’s involvement could signal a shift in how technology and energy policies are shaped in the future.

Challenges to the EV Market: A Smaller Market Ahead?

Trump’s scepticism about the future of electric vehicles extends beyond tax incentives. He criticised the Biden administration's stricter emissions standards, which require automakers to increase production of EVs and plug-in hybrids. Trump argued that these regulations are pushing the industry towards a "much smaller market" for EVs due to ongoing concerns about high costs and battery range limitations.

This perspective contrasts sharply with current trends, where many automakers are rapidly expanding their EV line-ups in response to global demand and regulatory pressures. If Trump were to relax these regulations, it could slow the momentum of EV adoption in the U.S. and alter the competitive landscape of the global automotive industry.

Trade Policies: Tariffs and Domestic Production

Beyond the EV market, Trump reiterated his commitment to reshaping U.S. trade policies, particularly concerning the automotive industry. He vowed to impose new tariffs on vehicles produced in Mexico for U.S. consumers, a move aimed at discouraging automakers from outsourcing production. "If you put tariffs on those cars, they're going to make it here," Trump asserted, emphasising his desire to boost domestic manufacturing.

Trump also expressed openness to foreign automakers, including Chinese companies, building vehicles in the U.S. "We’re going to give incentives, and if China and other countries want to come here and sell the cars, they’re going to build plants here," he said, highlighting a strategy to create jobs and stimulate the U.S. economy.

Big Tech in Trump's Crosshairs: Google and TikTok

Trump took a firm stance against Alphabet's Google, describing the tech giant as operating like the "Wild West." While he stopped short of calling for the company to be broken up, he hinted at significant penalties, stating, "They're going to have to pay a great price."

Trump also addressed the ongoing debate over TikTok, a popular short-video app owned by China’s ByteDance. Despite previous threats to ban the app, Trump acknowledged the complexities involved, particularly concerning free speech. He suggested that ByteDance might eventually sell TikTok’s U.S. assets, a move that could resolve the concerns surrounding the app’s ownership and data security.

A Complex Road Ahead for U.S. Policy

As Donald Trump campaigns for a return to the presidency, his comments signal a potential shift in U.S. policy across several sectors, from electric vehicles to trade and technology. His scepticism towards EV incentives, coupled with his willingness to engage with influential figures like Elon Musk, suggests that a Trump administration could take a markedly different approach to the issues shaping the future of the American economy. Whether these ideas resonate with voters and industry leaders remains to be seen, but the implications for U.S. policy and global markets are significant.

(Inputs from Reuters)

Republican presidential candidate Donald Trump recently indicated a potential shift in U.S. electric vehicle (EV) policy if he returns to the White House. Trump, known for his scepticism towards green energy incentives, suggested he might end the $7,500 tax credit for EV purchases.

Republican presidential candidate Donald Trump recently indicated a potential shift in U.S. electric vehicle (EV) policy if he returns to the White House. Trump, known for his scepticism towards green energy incentives, suggested he might end the $7,500 tax credit for EV purchases. This announcement could have significant implications for the burgeoning EV market in the United States, particularly for automakers who have benefited from these subsidies. Questioning the EV Tax Credit: A Possible Reversal? Trump's reservations about the EV tax credit are not new. During his previous term, he attempted to repeal the incentive, a move that was ultimately reversed under President Joe Biden’s administration, which expanded the credit in 2022. Speaking to Reuters after a campaign event in York, Pennsylvania, Trump expressed his general disapproval of tax credits and incentives. "Tax credits and tax incentives are not generally a very good thing," Trump stated, hinting at a possible rollback of these benefits if he is re-elected. The EV tax credit has played a crucial role in promoting the adoption of electric vehicles by making them more affordable for consumers. However, Trump’s comments suggest a preference for a more market-driven approach to the automotive industry. "I'm not making any final decisions on it," he said, adding that while he supports the concept of electric cars, he remains a fan of traditional gasoline-powered vehicles and hybrids as well. Elon Musk in a Trump Administration? In a surprising turn, Trump also indicated his openness to involving Tesla CEO Elon Musk in his administration. Praising Musk's intelligence and innovative spirit, Trump said, "He's a very smart guy. I certainly would, if he would do it, I certainly would. He's a brilliant guy." This potential collaboration could lead to interesting dynamics in U.S. technology and energy policies, given Musk's influence in the EV sector and beyond. Musk, who recently endorsed Trump in the U.S. presidential race, did not immediately respond to requests for comment on the possibility of joining a Trump administration. If appointed to a cabinet or advisory role, Musk’s involvement could signal a shift in how technology and energy policies are shaped in the future. Challenges to the EV Market: A Smaller Market Ahead? Trump’s scepticism about the future of electric vehicles extends beyond tax incentives. He criticised the Biden administration's stricter emissions standards, which require automakers to increase production of EVs and plug-in hybrids. Trump argued that these regulations are pushing the industry towards a "much smaller market" for EVs due to ongoing concerns about high costs and battery range limitations. This perspective contrasts sharply with current trends, where many automakers are rapidly expanding their EV line-ups in response to global demand and regulatory pressures. If Trump were to relax these regulations, it could slow the momentum of EV adoption in the U.S. and alter the competitive landscape of the global automotive industry. Trade Policies: Tariffs and Domestic Production Beyond the EV market, Trump reiterated his commitment to reshaping U.S. trade policies, particularly concerning the automotive industry. He vowed to impose new tariffs on vehicles produced in Mexico for U.S. consumers, a move aimed at discouraging automakers from outsourcing production. "If you put tariffs on those cars, they're going to make it here," Trump asserted, emphasising his desire to boost domestic manufacturing. Trump also expressed openness to foreign automakers, including Chinese companies, building vehicles in the U.S. "We’re going to give incentives, and if China and other countries want to come here and sell the cars, they’re going to build plants here," he said, highlighting a strategy to create jobs and stimulate the U.S. economy. Big Tech in Trump's Crosshairs: Google and TikTok Trump took a firm stance against Alphabet's Google, describing the tech giant as operating like the "Wild West." While he stopped short of calling for the company to be broken up, he hinted at significant penalties, stating, "They're going to have to pay a great price." Trump also addressed the ongoing debate over TikTok, a popular short-video app owned by China’s ByteDance. Despite previous threats to ban the app, Trump acknowledged the complexities involved, particularly concerning free speech. He suggested that ByteDance might eventually sell TikTok’s U.S. assets, a move that could resolve the concerns surrounding the app’s ownership and data security. A Complex Road Ahead for U.S. Policy As Donald Trump campaigns for a return to the presidency, his comments signal a potential shift in U.S. policy across several sectors, from electric vehicles to trade and technology. His scepticism towards EV incentives, coupled with his willingness to engage with influential figures like Elon Musk, suggests that a Trump administration could take a markedly different approach to the issues shaping the future of the American economy. Whether these ideas resonate with voters and industry leaders remains to be seen, but the implications for U.S. policy and global markets are significant. (Inputs from Reuters)

Trump considers ending EV tax credit, taps Musk for cabinet role

One could have his or her opinion about EVs and the tax incentives the US federal government has placed over time, but one cannot deny its effectiveness. Since enactment of these incentives from January 1, they have helped save more than USD 1 billion of the cost of new EVs and enabled roughly 150,000 people to buy both new and used vehicles this year.

However, this USD 1 billion figure is devoid of leases, thereby inferring that the actual amount of monetary benefits is even higher if the leases segment is taken under consideration. This is likely the reason why these ‘incentives’ are more popular this year: Next year we hope to keep this October tax credit end of year ‘deal’ but a much bigger Joseph ‘Instant discount’ this year or point of sale stimulus.

Also Read:&nbsp;<a href="https://www.wionews.com/autonews/carmakers-face-uk-dieselgate-lawsuits-worth-at-least-usd-76-billion-731033">Carmakers face UK dieselgate lawsuits worth at least USD 7.6 billion</a>

These incentives have played a big role in EV sales up to this point and have included the Biden Administration focusing on upgrading the charging stations for EVs and protection against foreign competition from EVs made in China. Federal tax incentives of up to USD 7,500 are in place and USD 3,750 is related to battery raw materials that are sourced in North America while the other USD 3,750 linked to vehicle assembly in the US.

However, developmental challenges still exist in regard to sustaining the promotion of EVs' adoptions. Improvement in the use of incentives across the globe cannot be entirely impelled by these incentives alone. Despite government investments in charging infrastructure for EVs, it has only led to small improvements in the number of chargers deployed. Tesla has recently dismissed employees, and now those who love their Model S electric cars praise the Supercharger; though other companies may soon emerge to fill any gaps that could result.

In conclusion, therefore it is hard to deny the fact that tax incentives have certainly played a very effective role in promoting the sales of EVs but at the same time it is equally important to understand that complementing the shortcomings in the infrastructure domain is equally important in crafting the fully-fledged experience of switching over to electric mobility.

One could have his or her opinion about EVs and the tax incentives the US federal government has placed over time, but one cannot deny its effectiveness. Since enactment of these incentives from January 1, they have helped save more than USD 1 billion of the cost of new EVs and enabled roughly 150,000 people to buy both new and used vehicles this year.

One could have his or her opinion about EVs and the tax incentives the US federal government has placed over time, but one cannot deny its effectiveness. Since enactment of these incentives from January 1, they have helped save more than USD 1 billion of the cost of new EVs and enabled roughly 150,000 people to buy both new and used vehicles this year. However, this USD 1 billion figure is devoid of leases, thereby inferring that the actual amount of monetary benefits is even higher if the leases segment is taken under consideration. This is likely the reason why these ‘incentives’ are more popular this year: Next year we hope to keep this October tax credit end of year ‘deal’ but a much bigger Joseph ‘Instant discount’ this year or point of sale stimulus. Also Read: Carmakers face UK dieselgate lawsuits worth at least USD 7.6 billion These incentives have played a big role in EV sales up to this point and have included the Biden Administration focusing on upgrading the charging stations for EVs and protection against foreign competition from EVs made in China. Federal tax incentives of up to USD 7,500 are in place and USD 3,750 is related to battery raw materials that are sourced in North America while the other USD 3,750 linked to vehicle assembly in the US. However, developmental challenges still exist in regard to sustaining the promotion of EVs' adoptions. Improvement in the use of incentives across the globe cannot be entirely impelled by these incentives alone. Despite government investments in charging infrastructure for EVs, it has only led to small improvements in the number of chargers deployed. Tesla has recently dismissed employees, and now those who love their Model S electric cars praise the Supercharger; though other companies may soon emerge to fill any gaps that could result. In conclusion, therefore it is hard to deny the fact that tax incentives have certainly played a very effective role in promoting the sales of EVs but at the same time it is equally important to understand that complementing the shortcomings in the infrastructure domain is equally important in crafting the fully-fledged experience of switching over to electric mobility.

US government issued over USD 1 billion in EV tax credits this year

China has announced a raft of new steps to spur consumer demand for cars, saying it would consider extending a tax break for electric vehicles and plans to remove some restrictions on second-hand car sales.

China unveils plans to spur car demand, may extend EV tax break

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Government to maintain 48% tax on hybrid cars and 5% on EVs

Trump considers ending EV tax credit, taps Musk for cabinet role

US government issued over USD 1 billion in EV tax credits this year

China unveils plans to spur car demand, may extend EV tax break