Nitin Gadkari urges states to reduce GST on flex-fuel vehicles
What's the story
Union Minister Nitin Gadkari has called for a reduction in Goods and Services Tax (GST) on flex fuel-based vehicles. He proposed a tax cut to 12% during his address at the India Bio-Energy & Tech Expo organized by IFGE. The minister emphasized the need for alternative fuel options, particularly for middle-class families who often opt for used cars and prefer road travel.
Flex fuel significance
Potential of flex-fuel in India's economy
Gadkari underscored the significance of flex-fuel in India's ethanol-based economy. He noted that leading car manufacturers such as Tata, Suzuki, and Toyota have already committed to introducing flex engine cars in India. Additionally, two-wheeler manufacturers Bajaj and TVS have prepared models equipped with flex engines that can run on 100% ethanol. This move is seen as a significant step toward promoting cleaner and more sustainable transportation options.
GST reduction
Appeal to state finance ministers
Gadkari revealed that he had requested Uttar Pradesh Chief Minister Yogi Adityanath to reduce the GST on flex fuel engine vehicles. Following this request, UP saw a decrease in taxes on such vehicles. Using this as an example, Gadkari urged other state finance ministers to consider similar tax reductions. He specifically asked Maharashtra's Finance Minister Ajit Pawar to discuss the issue with Union Finance Minister Nirmala Sitharaman.
Market potential
Gadkari emphasizes significance of vehicle business expansion
Gadkari highlighted the potential for vehicle business expansion in India. He stressed the importance of instilling confidence in stakeholders by reducing taxes on vehicles to boost sales. He also expressed gratitude toward Hardeep Puri, Minister of Petroleum and Natural Gas, for his support in implementing a clear policy on ethanol availability. India's ethanol blending program has saved ₹99,014 crore in foreign exchange since 2014.