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Government slashed GST to 5% from 12% for EVs

Published on July 27, 2019
Current context: The GST Council has slashed the GST rate on electric vehicles (EVs) to 5 %from 12%.
Government slashed GST to 5% from 12% for EVs 
  • The government has taken the step to give tax boost to the arm for the auto industry to promote the sale of EVs.
  • This is another move to significantly alter consumer behaviour in favour of EVs, with government method to hike the registration charges on petrol/diesel vehicles.
  • The slashing of GST rates on EVs is welcomed by the Society of Manufacturers of Electric Vehicles (SMEV) and will be effective from 1st August 2019.
  • The GST Council has also exempted hiring of Electric Buses by local authorities from GST.
  • The cut in the GST rate on electric vehicles will provide relief to customers, as higher cost of acquisition and inadequate infrastructure deterred them from looking at EVs.
  • Finance minister, Nirmala Sitharaman had proposed an income tax deduction of Rs 1.5 lakhs on interest paid on loans taken for EVs in her maiden budget speech.


Q.1 The government has reduced the GST on Electric Vehicles to____?
a. 12%
b. 5%
c. 18%
d. None of them

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