Archive · 20 Nov 2025
Industry Lobby Seeks GST Relief for Range-Extended Electric Vehicles
A big business group in India wants the government to make it cheaper to buy a special type of hybrid car called a REEV.
These cars use both electricity and a small engine to charge the battery.
Right now, hybrids are taxed more than electric cars, which makes them more expensive.
Some car companies want the government to give discounts to people who buy hybrids, but other companies disagree.
The business group says REEVs should be taxed the same as electric cars because they mostly run on electricity.
Assocham requests tax parity for REEVs with EVs to encourage automakers
Hybrids currently attract 18% or 40% GST, depending on size
Japanese automakers support hybrid incentives, while Tata and Mahindra oppose
States remove hybrid incentives, only Chandigarh and Haryana offer them
Assocham argues REEVs should be taxed at 5% like EVs due to electric propulsion
- Who
- Assocham, an industry lobby in India
- What
- Asked the government to provide tax parity for range-extended electric vehicles (REEVs) with electric vehicles (EVs)
- When
- 18 November
- Where
- New Delhi
- Why
- To incentivize automakers to introduce REEV models in India
Japanese Automakers
Tata Motors and Mahindra
Hybrid Incentives
Japanese Automakers
Support lower taxation, direct subsidies, or fee waivers for hybrid vehicle buyers
Tata Motors and Mahindra
Oppose any incentives for hybrid vehicles to encourage pure EV adoption
- Vehicle Type
- Range-extended electric vehicles (REEVs)
- Current GST Rate for Hybrids
- 18% or 40%, depending on size
- Proposed GST Rate for REEVs
- 5%
- Indian States Offering Hybrid Incentives
- Chandigarh and Haryana
- Estimated Hybrid Vehicle Market Share by FY30
- 14%