CHENNAI: The state transport department has proposed to extend 100% road tax exemption for electric vehicles (EVs) for another three years. If approved, EVs will continue to cost 8% less.
To promote sales of battery-operated vehicles, Tamil Nadu in 2008 fixed road tax for e-bikes as ₹750 and for personal cars, owners had to pay 3% to 6% of the vehicle’s cost as tax. Later, the government halved the tax amount and in 2019 waived off the tax completely up to December 2022.
With this deadline nearing, automobile showrooms started to advertise stating that this was the best time to buy EVs as cost could go up from January. Against this backdrop, the transport department has proposed to extend the tax-waiver until 2025 for personal cars and two-wheelers.
Welcoming this initiative, S Rajvel, state chairperson of Federation of Automobile Dealers Association (FADA), said this will continue to accelerate EV sales in the state. Along with the vehicle cost, a person aspiring to buy an EV now only has to pay ₹500 to ₹1,500 as registration fees (for smart cards). There is no additional on-road cost, he said. Given that EVs are more expensive than conventional internal combustion engine (ICE) vehicles, such initiatives will keep EV sales on the rise.
On an average, at least 4,500 new EVs hit the road every month and more than 58,000 EVs have been added to the state’s vehicular population this year. The sales could go up further if the government extends the benefit to the commercial sector too.
Unlike Bengaluru and Hyderabad, EV taxis are uncommon here because of the tax associated with registering such vehicles, said R Rengachari, a transportation activist. “If the government wants to bring down automobile pollution and promote EV use, it should waive taxes for them too.”
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