Expressing surprise over the government move to have a GST council meeting over a single agenda of reduction of duty on electric vehicles, West Bengal finance minister Amit Mitra has demanded a cut in GST rates for BS VI-compliant vehicles and hybrid vehicles which follow higher emission norms. A day ahead of the GST council meeting, Mitra, in a letter to Union finance minister Nirmala Sitharaman, said a large number of tax-related issues are pending with the fitment committee much before the matter of reduction of tax on electric vehicles was brought to the GST Council. “Is it not desirable that all pending issues should get similar importance? For instance, I have been requesting the council to consider the demand of the wagon industry in allowing refund due to an inverted duty structure. Our failure to address this issue is affecting the livelihood of more than 10 lakh family members,” Mitra said.
The West Bengal FM said the argument that a reduction in GST rate for electric vehicles from 12% to 5% will trigger huge investment in the EV sector, takes a “very myopic” view of the industry completely ignoring the disastrous impact which it will entail for the existing automobile units and the entire auto sector. He slammed government thinks tank Niti Aayog for directing the auto industry to completely switch to electric vehicles by 2025. “This seems totally impractical and in a way draconian,” Mitra said, adding that no country has yet introduced electric vehicles with an idea of completely banning fossil fuel vehicles