Tax on petrol scooters and bikes to incentivize EV adoption: EV makers’ group urges


The Society of Manufacturers of Electric Vehicles (SMEV) has called on the government to impose an additional green tax on two-wheelers equipped with internal combustion engines to encourage EV adoption and help reduce pollution from crude oil imports. The green tax will also justify an expected drop in EV sales as subsidies start to fall this month, the industry body representing electric vehicles said in a statement.

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Updated on:
June 7, 2023 at 08:56 am

Ola Electric is currently the leader in electric two-wheelers, followed by Ather Energy and others. The market for electric two-wheelers has grown exponentially in recent years due to the growing popularity of electric scooters.

It added that SMEV believes that a tax increase of 100 basis points on traditionally polluting ICE two-wheelers will be required to fund subsidies for electric two-wheelers and bring the FAME scheme back on track.

Sohinder Gill, director general of SMEV, said now is the time to allow the electric vehicle industry to compete with internal combustion engine vehicles.

“While we as an industry are addressing awareness and adoption, the biggest hurdle is cost of ownership as India is a price sensitive market.

Also read: Ola S1 Air rival Ather 450S electric scooter launches ¥129,000

He noted: “An additional green tax on ICE vehicles would not only bring EVs and ICE vehicles on the same level, but would also encourage larger OEMs to enter the EV market with confidence and long-term prospects, which would be beneficial. nation.”

The Ministry of Heavy Industry has reduced subsidies for electric two-wheelers from June 1, forcing companies to raise prices.

Starting this month, the incentive ceiling for electric two-wheelers has been lowered to 15 percent of the ex-factory price of the vehicle from 40 percent earlier.

India’s Accelerated Adoption and Manufacturing of Electric and Hybrid Vehicles (FAME) scheme started on April 1, 2019 for a period of three years and was further extended for two years until March 31, 2024.

First published date: Jun 7, 2023 at 08:56 AM CST

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