Electric vehicle industry expects big announcements

Finance Minister Nirmala Sitharaman Will present the Union Budget 2025 on 1 February 2025. The Electric Vehicle (EV) industry expects that major decisions will be taken in this budget to promote the EV segment. The government wants to ensure 30% share of EV in automobile sales by 2030. To achieve this goal, the industry has demanded subsidies and tax relief from the government.

Demand to reduce GST on charging service

• 5% GST is applicable on EV.
• The GST rate on batteries is also 5%.
• But 18% GST is applicable on EV charging service.

The industry believes that if GST on charging services is reduced to 5%, EV usage will get a further boost. This will not only accelerate EV sales but will also strengthen the charging infrastructure.

Need for subsidy scheme for common man

• Government’s goal:
  • To increase the sales of EV and encourage the public, the government will have to take steps towards providing subsidies and incentives.
  • So far the government has allocated ₹2,000 crore for EV charging infrastructure.
• Charging Station Detail:
  • 22,100 charging stations for four-wheelers.
  • 1,800 charging stations for electric buses.
  • 48,400 charging stations will be built for two and three wheelers.

Union Budget 2025: Nirmala Sitharaman will present the first full budget of Modi government 3.0 on February 1.

Different policies at state level

• There is a provision for subsidy on electric vehicles in different states, but the policies differ.
• Tamil Nadu: Subsidy up to ₹10,000.
• Maharashtra: Subsidy up to ₹5,000.
• Punjab: Subsidy up to ₹3,000.
• Jharkhand: Subsidy up to ₹5,000.

Importance of Central Government Policy:

Experts believe that if the central government brings a uniform subsidy scheme, then EV sales will get a boost across the country and all the states will benefit from it.

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What are the expectations of the EV industry from Budget 2025?

1. Charging Infrastructure:
   • Allocation of more funds for expansion of charging stations.
   • To develop charging network equally in rural and urban areas.
2. Extension of subsidy:
   • To implement a national level subsidy scheme by the Central Government.
   • Special subsidy for two and three wheeler EVs.
3. GST cut:
   • Reducing GST on EV charging services from 18% to 5%.
4. Affordable EV options for the common man:
   • Tax breaks to promote more affordable EV models.
   • Reduction in import duty of batteries.