Union Minister for Road Transport and Highways, Nitin Gadkari, has recently called for a reduction in the Goods and Services Tax (GST) on flex-fuel vehicles from 28% to 12%. This appeal was made during his address at the India Bio-Energy & Tech Expo. Gadkari’s push for lower GST on flex-fuel vehicles is part of a broader effort to promote biofuels and reduce India’s reliance on fossil fuels.
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Call for GST Reduction on Flex-Fuel Vehicles
Union Minister for Road Transport and Highways, Nitin Gadkari, is championing a significant tax break for flex-fuel vehicles to make them more affordable and drive their adoption across India. Currently, flex-fuel vehicles are taxed at 28% GST, the same rate applied to hybrid vehicles. In contrast, electric vehicles enjoy a reduced GST rate of just 5%.
Gadkari has proposed lowering the GST on flex-fuel vehicles to 12%, aligning it closer to the tax rate for electric vehicles. He believes this reduction will not only enhance the accessibility of these greener alternatives but also help mitigate India’s reliance on imported fossil fuels, which cost the nation around Rs. 22 lakh crore annually.
During his speech at the India Bio-Energy & Tech Expo, Gadkari emphasized the dual benefits of biofuels—reduced air pollution and decreased fossil fuel imports. Flex-fuel vehicles, which can operate on petrol, ethanol, or methanol-blended petrol, are recognized for their lower environmental impact compared to traditional vehicles. Gadkari’s initiative aims to support a transition towards these less pollutive fuels.
To advance this proposal, Gadkari has reached out to state finance ministers, including those from Maharashtra and Uttar Pradesh, urging them to advocate for this GST reduction in upcoming council meetings. By fostering broader support for biofuels, Gadkari hopes to address both environmental and economic challenges while making flex-fuel vehicles more accessible to the average consumer.
This move aligns with Gadkari’s broader commitment to sustainable energy solutions and his efforts to promote both flex-fuel and bio-fuel technologies in India.
Verdict
Nitin Gadkari’s push for lowering the GST on flex-fuel vehicles is a strategic move to promote cleaner energy alternatives and reduce India’s dependence on imported fossil fuels. By making flex-fuel vehicles more affordable through tax reductions, the government can drive greater adoption of biofuels, benefiting both the environment and the economy. Gadkari’s call for support from state finance ministers is crucial for this initiative to succeed and for advancing India’s biofuel sector.
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