The Government Might Consider Lowering Tesla's Import Tax Under Two Conditions - Details Are Here

The government may consider issuing a tax exemption for Tesla when an American electric vehicle (EV) manufacturer plans to sell its business in India.

However, there are two conditions Tesla Elon Musk must meet in order for the government to consider reducing the import duty on model cars and fully built units (CBU), reported Bloomberg News.

The government has asked Tesla to increase domestic purchases and participate in comprehensive production plans, said a person named in the report. Because of this information, the government is reportedly considering reducing tariffs on Tesla imported electric vehicles.

The Department of Heavy Industry and Public Trade asked Tesla for the above details at a conference earlier this month. The ministry also asked Tesla for its opinion on importing fully built vehicles against partially built vehicles (abolished units), which have a low import duty.

Tesla's plan to start selling electric cars in India hit the threshold earlier this year due to high tariffs on foreign vehicles. The current import duty is 60 percent for EV under $ 40,000 and 100 percent for anything above.

In July, the manufacturer of electric vehicles asked the government to reduce import duties from the current 60 percent to 100 percent to 40 percent. The company has reportedly demanded the removal of 10 percent of social security for all imported vehicles.

THE TESLA CHALLENGE IN INDIA

At a meeting earlier this month, Tesla told the government it had so far bought $ 100 million in equipment from India and hinted that the amount would increase after-tax relief. This was confirmed by the person quoted in the Bloomberg report.

In addition to increasing domestic purchases, Tesla has also pledged to make significant investments in sales, services, and charging infrastructure rather than considering large-scale investments in manufacturing once it has. entered the Indian market.

As the government appears to be reassessing its plans to comply with the Tesla deal, it said earlier this month that there are no plans to cut tariffs specifically for Tesla cars.

Tesla could face a major price problem in India if the government does not consider lowering import tariffs because the prices of its electric car models are already high. The Indian automotive market, where less than 1% of electric vehicles are sold, also faces many challenges.