[rangaraj]

Govt mulls lower taxes for 'green' cars
TOI
NEW DELHI: You may soon have to pay less to have a "green" car. And more to drive fuel-guzzling SUVs. Vehicles not meeting upcoming fuel efficiency standards could face increasing excise duties — besides higher parking fees — while those which adhere to norms could enjoy much lower rates.

The government is considering a set of "reward and punishment" measures as part of a new public transport policy. The draft policy is being finalized by the Planning Commission and is expected to be ready by next week so that it can be shared with various ministries. The push for the policy came from Prime Minister Manmohan Singh.

The policy, when formulated, could align India with several developed and high-octane economies like China, which are trying to delink their transport systems from the growth of inefficient private vehicles.

With the sale of SUVs and other fuel guzzlers rising by 60% between 2000 and 2004, and expected to jump much higher if unchecked, one of the proposals before the government is to levy the highest amount of entry tax, parking and congestion charges on these inefficient class of vehicles.

At the other end of the efficiency spectrum, the much cleaner hybrid and hydrogen-based cars and buses could be rewarded with reduced customs duty. Domestic manufacturers of electric and hydrogen vehicles could also benefit from lowered excise duty if the proposals are accepted.

The government is seriously considering the carrot-and-stick approach once fuel efficiency norms are in place. Some quarters within the government are also proposing financial disincentives in the form of continuous increase in excise duties for fuel inefficient and high greenhouse gas producing vehicles. The most fuel efficient vehicles in each category could enjoy duty rebates.

In order to correct an imbalance and provide fiscal support to public transport, the policy could also recommend reworking excise rates at the central level and registration fees and road taxes at the state level in favour of buses and other forms of efficient public transport systems.

While the bus crisis in Delhi drew attention for a while, the Planning Commission estimates a demand of 9.97-10.87 lakh buses across the country in the 11th Plan period.

State transport undertakings today run 1.13 lakh buses but carry more than 6 crore passengers per day. The buses are, however, crowded out by private vehicles which constitute 81% of the total registered vehicles on road and yet carry out only 50% of the journeys performed every year.

[rangaraj]

I was hoping that the budget would have some duty cuts on CBU SUVs and in light of this story (wonder if it will kick in by the budget), will SUV's cost more.. Any SIAM or folks who know the political circles can comment on this?

[zenx]

Purely on FE - I guess the Safari will have a bigger attraction now than the CRVs et al of the world. This is a pretty decent move, and may drive automakers towards fuel efficiency. The Nano should be 35kmpl+ in a year or so

[Car-Agey]

Originally Posted by zenx

Purely on FE - I guess the Safari will have a bigger attraction now than the CRVs et al of the world. This is a pretty decent move, and may drive automakers towards fuel efficiency. The Nano should be 35kmpl+ in a year or so

Agree with you zenx. I somehow feel that Nano will be 25kmpl+ when launched, I feel TATAs are hiding the real specifications just to keep the competetion in the dark as the actual launch is few months away.

[snaronikar]

But will this be implemented? I don't think so. The ACMA lobby is strong and they may never want this to happen.

[windsurfer]

I think Govt. should have included the safety gadgets as well for rebates.

[Maverick1977]

Hats off to the Govt. if they actually succeed in implementing such a rule, especially if this would affect foreign manufacturers who have set shop in India. The external pressure might be simply too much...

[srishiva]

This measure I hope will increase diesel vehicle output. But without tightening the diesel emissions, it would be bad for everyone's health.

[rangaraj]

It would force an Indian standard for measuring FE - city and highway which will allow everyone to publish these figures (not that some of them would want to!) and benefit all of us. Could be incorporated as part of ARAI testing and certification.

Good move by Gov. But very difficult to implement in India.
I don't think there is any standard device which can calculate the fuel efficiency of the vehicle, since it depends on various factors. If so then there will be many loop holes and users can tweak their engines for better performance compromising with the fuel efficiency.

[thangu]

This is a good move, provided they are able to implement the parking and congestion charges. I guess in India we should be able to implement only the taxes properly...

It's good to know that they are planning to give incentives to hybrid, electric and hydrogen fueled vehicles. Some Indian manufacturers like Mahindra have spoken about Hybrids, this move of taxes will induce more manufacturers to explore these options.


TATA - are you listening? I think they will probably be the one to offer an affordable hybrid in the future for us...

[JoseVijay]

Government readies subsidy for hybrid and electric cars.

NEW DELHI: Buying a hybrid or an electric car may soon fetch you a subsidy from the government, which is readying a Rs 14,000-crore scheme to push green vehicles.

The subsidy will be a proportion of the difference between the price of a car running on fossil fuel and that of a green vehicle, said sources involved with the discussions.

The heavy industry ministry, which has moved a proposal for clearance by the finance ministry, has suggested that the maximum subsidy of 35% should be given to pure electric vehicles, while a 25% benefit should be provided for plug-in vehicles that can drive for at least 15km at one go.

Similarly, the purchase of mild hybrids will fetch you a 15% subsidy, while a stronger version will get a 25% benefit.

Currently, only a handful of hybrid models are available in India which includes the Scorpio from the M&M stable, Toyota Prius, Toyota Camry in addition to electric vehicles such as Mahindra e2o.

If the ministry's proposal goes through, the government will, for instance, provide a subsidy of around Rs 1 lakh on the purchase of a hybrid Toyota Camry, which costs around Rs 33 lakh in Delhi, while the one running on petrol is priced at Rs 28 lakh.

The government is hoping that the subsidy, which will routed through auto companies and will result in a reduction in prices, will encourage more Indians to shift to green energy. Although the scheme is expected to cost the exchequer Rs 14,000 crore till 2020, savings in fossil fuel usage has been estimated at Rs 60,000 crore over a six year period, said an official.

Several countries such as the UK, China, Germany and some states in the US and Canada had introduced sops, including subsidies and tax benefits, to promote electric vehicles.

Although the government discussed the plan in the past, it has failed to move on the proposal. It is only now that the heavy industry ministry has sent the proposal to the expenditure finance committee headed by the expenditure secretary. Sources said the ministry has also included the issue in its 100-day work programme submitted to prime minister Narendra Modi.

"The entire process, which will include cabinet approval, should take around two to three months," said an official. But he refused to put any timeline on when the subsidy scheme will be in place.

Source: http://timesofindia.indiatimes.com/b...w/37926670.cms

[Dry Ice]

Originally Posted by JoseVijay

Government readies subsidy for hybrid and electric cars.

Currently, only a handful of hybrid models are available in India which includes the Scorpio from the M&M stable, Toyota Prius, Toyota Camry in addition to electric vehicles such as Mahindra e2o.

What hybrid version does Scorpio come with? I hope it is just an error at TOI's end and not the at the Government level. AFAIK, "Micro Hybrid" cannot be compared with other cars listed there - it is a system to minimize the fuel consumption and one has the option to even turn it off! It doesn't have any other alternate power source!

If the ministry's proposal goes through, the government will, for instance, provide a subsidy of around Rs 1 lakh on the purchase of a hybrid Toyota Camry, which costs around Rs 33 lakh in Delhi, while the one running on petrol is priced at Rs 28 lakh.

Can't help but smile at this. Talk of disconnected government. They want credit for promoting hybrid vehicles in the country thats all! Providing a subsidy of 'around' 1 lakh for a 33 lakh car? and they hope this will make people shift from petrol to electric/hybrid? wow!

Instead they could have fixed the subsidy at a % of the cost of the vehicle to make it more meaningful. But then I guess, they would have overshot their target for this 'scheme'.

Since this government is betting big on going green - I would love to see the CNG network develop across India. A lot of folks would automatically shift to CNG if availability is good. Commercial segment can also be encouraged to shift to CNG - would help reduce the diesel subsidy burden.