GST rates on electric vehicle reduced from 12% to 5%

GST rates on electric vehicle reduced from 12% to 5%

36^th GST Council Meeting chaired by Finance Minister Nirmala Sitharaman, was held via video conferencing.

In the meeting it has decided to reduce GST rate on Electrical Vehicles from 12% to 5% and on EV Chargers from 18% to 5% from 1st August 2019.

GST Council also approved exemption from GST on hiring of Electric Buses by local authorities.

The new rates will be effective from 1st August 2019.

The move is seen as a much needed step to encourage the adoption of EVs by people. The EV manufacturers had been asking for a cut in the GST rate on electric vehicles.

The government is aggressively pushing the adoption of EVs. In her maiden Budget, Nirmala Sitharaman had proposed an income tax deduction of Rs 1.5 lakhs on interest paid on loans taken for EVs.