In what is sure to be a blow to the EV dreams of many in the country, India has rejected Elon Musk’s request for lower taxes for importing electric cars. The reason cited was the fact that rules for bringing in allow bringing in partially-built vehicles and assembling them locally at a lower levy are already in place. Currently, the import duties on EVs can be as high as 100 percent.
According to a report by Bloomberg, Vivek Johri, chairman of the Central Board of Indirect Taxes and Customs, said in an interview, “We looked at whether the duties need to be re-jigged, but some domestic production is happening and some investments have come in with the current tariff structure.” He further added that this is clearly not a hindrance. Moreover, Johri believes that the current tax structure is well suited to local assembly of automobiles.
Tesla CEO Elon Musk had received invitations from Indian ministers to set up base in their represented state. The Punjab Pradesh Congress Committee president Navjot Singh Sidhu who took to Twitter to reach out to Elon Musk. Quoting a Tweet which was earlier made by Musk, Sidhu said, “I invite @elonmusk, Punjab Model will create Ludhiana as hub for Electric Vehicles & Battery industry with time-bound single window clearance for investment that brings new technology to Punjab, create green jobs, walking path of environment preservation & sustainable development.”
This tweet was a reply to a Tweet posted recently by Elon Musk wherein the Tesla CEO had said that the company is, “Still working through a lot of challenges with the government.”
Tesla CEO Elon Musk had replied to a tweet by Twitter user Pranay Pathole, who had posted a question related to Tesla’s launch in India, asking “Yo @elonmusk any further update as to when Tesla’s will launch in India? They’re pretty awesome and deserve to be in every corner of the world!”
This comes after Maharashtra minister Jayant Patil had also recently tweeted to Elon Musk calling him to establish Tesla’s base in the state. Patil had tweeted, “Maharashtra is one of the most progressive states in India. We will provide you (with) all the necessary help from Maharashtra for you to get established in India. We invite you to establish your manufacturing plant in Maharashtra.”
And this is not it, prior to Patil’s Tweet it was the Industry & Commerce Minister of Telangana, Kalvakuntla Taraka Rama Rao, who said that the state would be happy to partner with Tesla in working through the challenges to set shop in India/Telangana. He had tweeted, “Hey Elon, I am the Industry & Commerce Minister of Telangana state in India. Will be happy to partner with Tesla in working through the challenges to set shop in India/Telangana. Our state is a champion in sustainability initiatives & a top-notch business destination in India”
Previously, Musk had urged Prime Minister Narendra Modi to cut down on import taxes on EVs before the company enters the Indian market, as told to Reuters. In fact, India has a customs duty ranging between 60 percent to 100 percent on imported cars.
Musk also said that taxes in India are among the highest in the world, and hence, wanted them cut before there could be an entry into the Indian EV market. This invited the ire of a lot of Indian automobile manufacturers, who felt that this may discourage investment in local manufacturing.
Furthermore, Musk-owned Tesla had received approval for three more trims of its electric vehicles in India, bringing the total to seven versions approved in the country, media reports said. Tesla India received approval for three more vehicles in the country, citing information from the Ministry of Road Transport and Highways, Teslarati reported earlier.
In August 2021, Tesla received homologation certificates for four of its car models. With three more certificates, the electric vehicle maker now has seven vehicles approved in India. The precise Tesla variants that received approval have not been specified. However, there have been sightings of Model 3s and Model Ys on Indian roads, the report said.
The latest three vehicles with homologations certificates have not been named either, it added. A few Tesla test units have been regularly navigating through local roads in India. Still, the US-based EV maker has yet to make any serious moves toward local production.
Earlier this year, Musk noted that a Tesla factory in India might be possible if Tesla were to succeed with imported vehicles. As per the report, some sources stated that Tesla requested to reduce the import duties of vehicles sent to India by at least 40 percent, which could help the US company test demand in the country. However, governing officials stated that there is zero chance for a single company, like Tesla, to receive specific incentives.
(With IANS Inputs)
Keyword: Tesla CEO Elon Musk's Call For Lower Taxes on Import Cars in India Rejected