December 22, 2024 | Jaisalmer
The GST Council, chaired by Union Finance Minister Nirmala Sitharaman, has made a crucial change affecting the electric vehicle (EV) market.
Key Highlights:
- Higher GST for Businesses: The GST on the margin value of used EV sales by businesses has been increased from 12% to 18%, aligning with the rate for non-electric vehicles.
- Exemption for Individuals: Used EV sales between individuals will remain GST-free, encouraging direct transactions in the secondary market.
Implications for the EV Sector:
- Impact on Businesses:
Leasing companies and used EV dealerships will face higher GST rates, potentially influencing their pricing and operational strategies. - Boost for Direct Sales:
GST exemption on individual-to-individual transactions could encourage more private sales, bypassing business intermediaries. - Market Dynamics:
Aligning GST rates for used EVs and non-EVs may streamline tax policies, signaling the government’s intent to treat both segments equally.
This change is part of India’s larger push toward sustainability and its commitment to accelerating EV adoption while balancing economic and tax policies.
