In order to boost electric vehicle (EV) sales, the Centre is now looking at increasing taxes on petrol and diesel-powered cars, reports Mint. The Ministry of Finance feels the proposal would help offset the subsidies that the Centre will hand out as part of the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme. In a memorandum to the executive finance committee, the ministry has also said that it would catalyse the sluggish sales of EVs.
While the Society of Indian Automobile Manufacturers (SIAM) declined to comment on the matter, industry sources say the move would hit the sales of cars in general, given the price sensitivity of the Indian automobile market.
Meanwhile, the Society of Manufacturers of Electric Vehicles (SMEV) has welcomed the move, saying that EV sales would pick up only when the cost is equal to that of an internal combustion engine (ICE).