Heavy industries ministry to seek lowering of GST for hybrid vehicles

New Delhi, Jun 12: Union Heavy Industries Minister Anant Geete on Monday said he will take up the issue of lowering the 43 per cent tax rate on hybrid vehicles under GST with Finance Minister Arun Jaitley.

On Sunday, Jaitley hinted that the tax rate on hybrid cars will not be reviewed, saying the industry demands were not in sync with a study conducted by tax officers. The GST Council has fixed 43 per cent tax (28 per cent GST plus 15 per cent cess) on hybrid cars, a rate that the automobile industry feels is too high for the fuel efficient vehicles.

When contacted, Geete told PTI he would take up the issue with the finance minister. Earlier also, the heavy industries ministry had written to its finance counterpart seeking lowering of the 43 per cent tax rate on hybrid cars.

'Our ministry has firmly sought the lowering of the tax on hybrid vehicles. The tax incentives will boost the sales of



hybrid vehicles,' Secretary in the Department of Heavy Industry Girish Shankar said.

Addressing reporters after the GST Council meeting on Sunday, Jaitley said: 'We have done a detailed study on auto industry demand and a paper has been made which will be circulated among members. And, if necessary, it would come up for discussion. The fact that is being presented (by the industry), according to the paper, is not correct'.

When contacted, Society of Indian Automobile Manufacturers Secretary General Vishnu Mathur said it would not be possible to comment without understanding contents of the report.

Similarly, Toyota Kirloskar Motor Vice-Chairman Shekhar Vishwanathan said: 'We would like to know the contents of the report that the finance minister is talking about. First of all we need to be clear about the definition of hybrid - vehicles that have an internal combustion engine and an electric motor.'