Tarun Kapoor, Adviser to the Prime Minister, suggested that it might be necessary to reconsider the taxation on batteries. He also noted that the Goods and Services Tax (GST) is higher when charging is offered as a service, a concern that has been brought to the attention of the relevant authorities. Kapoor explained that any decisions regarding GST are made by the GST council, not directly by the government.
Tarun Kapoor, adviser to the Prime Minister, recently emphasised the need for a comprehensive review of taxation issues related to batteries for four-wheelers and electric vehicle (EV) charging services. Speaking at a Federation of Indian Chambers of Commerce & Industry (FICCI) event in New Delhi, Kapoor pointed out the complexities of GST applied to EV charging services, which is treated at a higher rate because it is categorized as a service. He mentioned that these concerns have been brought to the attention of the relevant authorities, as decisions on GST are made through the GST Council, where the government does not have direct decision-making power.
Kapoor also discussed the broader implications of taxation on the viability and competitiveness of the EV industry. He highlighted the government’s commitment to the sector, not only for energy security but also to position India as a hub for EV manufacturing. He stressed the importance of setting ambitious targets for two-wheelers and aiming for a complete transition to electric in this segment. Kapoor reiterated similar goals for three-wheelers, suggesting a total switch in certain cities, and confirmed substantial government support for four-wheelers.
Additionally, Kapoor noted significant government investment in EV infrastructure under the PM E-Drive scheme, which allocates a considerable budget for the development of charging facilities. The scheme’s outlay has been increased to INR 2,000 crore, doubling the funding compared to the FAME-II scheme, and includes plans for installing 22,100 fast chargers for four-wheelers, underscoring the government’s strategic initiatives to enhance India’s EV charging infrastructure.
