During a Sunday meeting with automakers, Uttar Pradesh Chief Secretary Manoj Kumar Singh confirmed to industry sources that the decision would not be reversed.
Uttar Pradesh has decided to maintain the waiver on registration taxes for hybrid vehicles, according to two informed sources speaking to Reuters. This decision benefits Toyota but poses challenges for Tata Motors and Mahindra & Mahindra. Hyundai, Kia Motors, Mahindra, and Tata, which together account for 10% of India’s car sales, had urged the state to eliminate this incentive. They argued that it would hinder India’s goals for adopting fully electric vehicles and impact their investment strategies, as per Reuters.
At a meeting with automakers last Sunday, Uttar Pradesh Chief Secretary Manoj Kumar Singh confirmed that there would be no reversal of this policy, reported an industry source and a state government official familiar with the matter.
Singh was unavailable for comment when attempts were made to contact him. Industry executives have expressed concerns that other states might adopt Uttar Pradesh’s approach, which last month reduced the cost of some hybrid vehicles by 10% due to the tax waiver. The meeting saw attendance from Hyundai, Mahindra, and Tata representatives, who opposed the tax waivers, as well as from Maruti and Toyota, who support the initiative, a source disclosed. Mahindra declined to comment, and responses from other automakers were not immediately available.
In India, electric vehicles (EVs) are subject to a 5% federal tax, while hybrids face a 43% tax, slightly less than the 48% for gasoline vehicles. Additional state road and registration taxes vary by local government.
