Budget 2025: If you are planning to buy an Electric Vehicle (EV), wait till February 1. Finance Minister Nirmala Sitharaman is going to make important announcements related to EVs in the upcoming Union Budget 2025.
No special subsidy or incentive was given on EVs in last year’s budget, which disappointed potential buyers. This time it is expected that the government will take concrete steps to reduce EV prices and other benefits.
Measures to reduce the price of EV
Experts believe that if the government wants to promote the use of Electric Vehicles, then first it has to be made cheaper. The price of EV is higher than petrol and diesel vehicles, due to which customers are not interested in buying them.
If the government reduces GST on EV related parts, it can bring down prices significantly. Currently, 5% GST is levied on EV, its battery, and charging infrastructure, while 28% GST is applicable on EV parts and accessories. 18% GST is also levied on maintenance and repairs of EVs.
Demand for PLI scheme for EV industry
Regarding the Production Linked Incentive (PLI) scheme, industry experts suggest that the government should implement it to promote the production of EV batteries. This scheme will provide incentives in battery manufacturing, which will reduce the cost and the price of EVs can come at par with petrol and diesel vehicles. Currently, due to the high price, customers avoid buying EVs.
Announcement of subsidy scheme possible
It is likely that the government may announce a cut in loan interest rates on purchasing EVs and give direct subsidy to the customers. Currently, state governments provide EV subsidy at their own level, due to which there is a difference in subsidy between states. If the central government announces subsidy, it can make EV prices more accessible.
Improvement in charging infrastructure
The government can also emphasize on the development of charging infrastructure. Better charging facilities will be an important incentive for EV users. This will increase the number of EV adopters.
Conclusion: If you are planning to buy an EV, wait for the announcements after Union Budget 2025. Possible GST cuts, subsidies, and PLI schemes may reduce the prices of EVs. This may be the best time to buy an EV.