Toyota urges for lower GST rates on Hybrid Vehicles

Toyota Kirloskar Motor (TKM) is lobbying for merit-based taxation on technologies such as hybrids. Hybrids are said to have “the lowest carbon footprint from a well-to-wheel perspective, according to a study by the Bengaluru-based Indian Institute of Science (IISc).

The company is looking for a GST cut on hybrid vehicles when the GST Council meets after the elections.

Hybrids are taxed at a rate of 28% GST, which, combined with the cess, raises the tax rate to 40% in certain vehicles. According to reports, despite Transport Minister Nitin Gadkari’s suggestions for a 12% GST on hybrids, the council is unwilling to reduce the rate.

Toyota, which has launched hybrids into mass market segments with automobiles like the Hyryder, believes that government policies should be aligned with its objective of bringing the country to net zero by 2050.

“As we strive for energy self-sufficiency by 2047 and highly aggressive carbon reduction targets, policies should begin to line with technology. To accelerate the realization of national fossil fuel goals, decarbonization, employment development, and linkages must occur, as should policy alignments. And the market should be left to decide how various technologies may best help fulfill those objectives in a transparent and unbiased manner,” said Vikram Gulati, TKM’s country head and executive vice president.