The Telangana government has replaced the road tax exemption for electric cars with a levy ranging from 11-15%. The move, which came into effect on August 1, 2023, has surprised many potential EV buyers.
The previous exemption had been in place since 2020, and had been seen as a major incentive for the adoption of electric vehicles in the state. The new rates are significantly higher than those in other states, such as Karnataka, which charges a flat 8% road tax on electric cars.
The Telangana government has said that the new rates are necessary to generate revenue for the state. However, the move has been criticized by EV industry experts, who say that it will discourage the adoption of electric vehicles in Telangana.
The new rates are also likely to have a negative impact on the state’s target of having 10% of all new vehicles registered in Telangana as electric vehicles by 2030.
In a statement, the Telangana government said that the new rates were “based on the current market price of electric vehicles”. The government also said that it would continue to provide other incentives for the adoption of electric vehicles, such as subsidies for the purchase of electric vehicles and the installation of charging infrastructure.
However, the new rates are likely to make electric vehicles more expensive for consumers, and could dampen the enthusiasm for EV adoption in Telangana.
The government’s decision to replace the road tax exemption with high rates is a setback for the EV industry in Telangana. It remains to be seen whether the state will be able to meet its target of having 10% of all new vehicles registered in Telangana as electric vehicles by 2030.