GST RATE CUT ON ELECTRIC VEHICLES

 

For: Preliminary & Mains

Topics covered: GST rate changes, Electric vehicles, Significance, Challenges

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News Flash

The Central government announced GST rate reduction for electric vehicles, chargers and charging stations.

• The changes shall come into effect from August 1, 2019.

 

Highlights

• The 36th GST Council Meeting recommended a reduction of GST rate on all-electric vehicles from 12 percent to 5 percent.
• The GST rate on the charger/ charging stations for Electric vehicles is reduced from 18 percent to 5 percent.
• The hiring of electric buses (of carrying capacity of more than 12 passengers) by local authorities will be exempted from GST.

 

Significance

• Accelerate the adoption of electric vehicles.
• Reducing air pollution in the country.
• Reduce/ Do not produce greenhouse gas emissions.
• Reduce dependency on a fossil-fuel based economy.
• Electric vehicles may contribute to a reduction in noise pollution levels in cities.
• Energy efficiency and emission reduction have improved in automobiles.

 

Challenges faced

• Charging infrastructure
• Cost
• Lack of renewable energy and grid infrastructure

 

National Electric Mobility Mission Plan 2020

• India unveiled the NEMMP 2020 in 2013 to address the issues of National energy security, vehicular pollution and growth of domestic manufacturing capabilities.
• The Government has plans to make a major shift to electric vehicles by 2030, committed under Paris Agreement.

 

Way Ahead

• ISRO has tested a solar-powered hybrid car- a modified Maruti Omni with a solar panel platform installed on top of the car.
• The installation of this solar platform on the car has been rated “awful” for its design.

 

Source: The Hindu Businessline

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