Budget 2019: SIAM welcomes Government’s cut on import duty for electric vehicle components

 The Society For Indian Automobile Manufacturers (SIAM) has welcomed the central government’s move to lower the import duty on CKD and SKD of electric vehicle components. The notification issued by the government earlier this week stated that the parts and components for electric vehicles imported in the country will be lowered by 10 to 15 per cent.

Written by Newsroom Staff February 1, 2019 13:18

New Delhi: The Society For Indian Automobile Manufacturers (SIAM) has welcomed the central government’s move to lower the import duty on CKD and SKD of electric vehicle components. The notification issued by the government earlier this week stated that the parts and components for electric vehicles imported in the country will be lowered by 10 to 15 per cent.

Previously, the vehicle parts and components imported for assembly in India attracted an import duty of 15 to 30 per cent. The Central Board of Indirect Taxes and Customs (CBIC) has created a separate category for parts and components for electric vehicles.

The CBIC has also removed customs duty exemption to battery packs for electric vehicles and also doubled the duty on battery packs for mobile phones. While the import duties were lowered on EV components, the government did not allow to import fully built electric vehicles at a concessional rate, a move that has also been appreciated by SIAM, as a way to promote the Make-in-India initiative.

The notification comes before the Union Budget 2019 and removes any ambiguity around the definitions of CKD and SKD for electric vehicles across segments. The notification states that fully built EVs will still attract 60 per cent/100 per cent duty for passenger vehicles, 50 per cent for two-wheelers and 25 per cent for trucks and buses, as they are for conventional vehicles, as suggested by SIAM. Furthermore, import duty on battery cell has been raised from zero to 5 per cent under the new notification.

 

SIAM states that with no cell manufacturing in the country at present, the local battery pack with imported cells will become more expensive. Thereby making electric vehicles more expensive to own. That said, the move is expected to encourage cell manufacturing in the country and contribute to the electric vehicle infrastructure development.

Credits: NDTV Auto

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