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GST Council Decides To Reduce Rate On Electric Vehicles To 5% From August 1

The 36th meeting of GST Council, chaired by Finance Minister Nirmala Sitharaman, was originally scheduled for July 25 but was postponed to Saturday.

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GST Council Decides To Reduce Rate On Electric Vehicles To 5% From August 1
The GST or Goods and Services Tax Council on Saturday decided to reduce the rates applicable to electric vehicles (EVs) and the chargers used for such vehicles. In a statement released after the conclusion of its 36th meeting, the GST Council said it had decided to revise the rates applicable to electric vehicles and electric vehicle chargers to 5 per cent each with effect from August 1. The 36th meeting of the GST Council, chaired by Finance Minister Nirmala Sitharaman, was originally scheduled for July 25 but was postponed to Saturday.
Here are 10 things to know about the changes announced by the GST Council:
  1. Currently, the rates applicable to electric vehicles and their chargers stand at 12 per cent and 18 per cent respectively. 
  2. The GST Council also decided to exempt the hiring of electric buses of carrying capacity beyond 12 passengers by local authorities from the indirect taxation regime. 
  3. The GST rate applicable to charging stations for electric vehicles was also reduced from 18 per cent to 5 per cent.
  4. The Council announced an extension in the due date for filing of the form GST CMP-02 in order to opt for the composition scheme under GST laws. 
  5. Now, assessees will be able to opt for the composition scheme under the GST law using the form CMP-02 by September 30, instead of the original due date of July 31. 
  6. The Council also decided to extend the last date for furnishing the statement containing details of self-attested tax using the form GST CMP-08 for the June quarter by one month to August 31. 
  7. The CMP-02 and CMP-08 forms come under the GST composition scheme.
  8. Under the composition scheme, traders and manufacturers are required to pay only one per cent GST on goods which otherwise attract a higher levy of either 5, 12 or 18 per cent. Such dealers are also not permitted to charge GST from the purchaser.
  9. In the Union Budget for 2019-20, the Finance Minister proposed a deduction of Rs. 1.5 lakh in taxable income on the interest paid on loans taken to purchase electric vehicles. 
  10. Saturday's meeting of the GST Council, chaired by the Finance Minister, was held through video conferencing.

(With inputs from agencies)





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