After India Junior Minister Krishan Pal Gurjar said Tesla won’t see lowered import duties last week, two senior government executives have reportedly said otherwise.
India’s government is seriously talking about the potential to cut import taxes from 60 percent to 40 percent on cars under $40,000, according to two senior government officials, and as reported by Reuters.
The $40,000 limit reportedly applies to the car’s insurance, freight and total cost, and cars over $40,000 could become subject to just 60 percent import duties, compared to the government’s typical 100 percent import tax rate.
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One of the sources, who asked to remain unnamed since the knowledge is not yet public, said, “We haven’t firmed up the reduction in duties yet, but there are discussions that are ongoing.” The official continued, “Reducing import duties is not a problem as not many EVs are imported in the country. But we need some economic gain out of that. We also have to balance the concerns of the domestic players.”
While the import duty decrease is being discussed, it’s expected to only apply to electric vehicles (EVs), rather than to gas cars – so as not to pose a threat to other, local automakers.
Earlier this year, the Indian government also told Tesla it could offer the lowest production costs in the world if Tesla was to establish a production facility in the country.