Govt proposes tax breaks for ‘expensive’ new energy vehicles

The government has started consultations for the New Energy Vehicle (NEV) Policy 2025-30, aimed at revolutionising the country’s transportation sector to cut carbon emissions. In this regard, a meeting was held in the Ministry of Industries on Monday, attended by the automakers, and it was highlighted that the policy would focus on promoting local NEV manufacturing, decreasing reliance on fossil fuel imports, and reducing carbon emissions. The meeting discussed incentives to boost NEV production, including tax breaks, reduced import duties on NEV components, and green financing options for companies investing in environmentally friendly technologies. However, industry sources said that the automakers expressed concerns that incentives being provided under the NEV policy would only benefit the top 10-20 per cent of auto consumers due to the high cost of the NEVs compared to internal combustion engine (ICE) and hybrid vehicles.