No GST Exemption on Electric Vehicle Charging at Public Charging Stations

The Fitment Committee, a GST panel made up of state and central revenue officials upheld the decision to levy 18% GST on the charging of electric vehicles (EVs) at public charging stations, rejecting appeals for an exemption.

The industry’s appeal focused on the dual nature of the EV charging process: access to electricity and supplementary expenses associated with using the station.

Although the supply of electrical energy is exempt from GST under notification No. 2/2017-CTR, and services linked to electricity transmission and distribution are also exempt under notification No. 12/2017-CTR, it was suggested that the same exemption should be extended to EV (electric vehicle) charging services.

Despite this, the Karnataka Authority for Advance Ruling (AAR) has declared that charging batteries at public charging stations is a supply of service, hence the total consideration is subject to an 18% GST.

The Karnataka AAR’s verdict emphasized that the service provided at EV charging stations includes beyond merely the supply of power. It entails the supply of facilities and services required for charging, which justifies imposing GST on the total amount charged.

The Ministry of Power previously explained that charging an EV battery is a service that utilizes electricity but does not represent electricity sales. This distinction played a significant role in the decision to keep the present GST rate.

Therefore, EV users will continue to pay 18% GST on total charges at public charging stations.