Dehradun: The decision to give 100 percent exemption in vehicle tax to hybrid cars in Uttarakhand on the lines of UP has been put on hold amid opposition. Tata and Mahindra have called this decision harmful and have demanded the government to withdraw it, which the government is now reconsidering.
In the first week of June, the cabinet had approved 100 percent exemption in vehicle tax only to plug-in hybrid electric cars and strong hybrid electric cars under the new Rule 125-M of the Central Motor Vehicles (9th Amendment) Rules 2023 in the Uttarakhand Motor Vehicles Taxation Reform Act. This exemption was made valid for the financial year 2025-26. After the tax exemption, hybrid cars would have been registered here. This would have caused a loss of vehicle tax to the state, but the state would have got 28 to 43 percent GST levied on the sale of these cars.
Customers’ inclination towards hybrid cars will increase
Toyota, Maruti, Honda make hybrid cars, but companies like Tata, Mahindra do not have such cars. According to sources, Tata and Mahindra have invested heavily in the state. The company representatives told the government how this decision would affect their business. The inclination of customers towards hybrid cars will increase, which will also affect the market of EV cars of these two companies. Therefore, the company representatives have demanded to withdraw this decision.
It is being told that the government has taken seriously the proposal of these companies investing in the state. In the coming time, a proposal to cancel this decision may come in the cabinet. Deliberations are going on on this.
This was the transport department’s argument behind the exemption
The transport department officials argued that till now many states including UP are also giving exemption in vehicle tax to hybrid cars on the lines of electric vehicles. Due to this, most of the hybrid cars of the state are being registered in those states instead of Uttarakhand, due to which vehicle owners get a benefit of three to three and a half lakh rupees. Due to which our state suffers loss. Only 750 hybrid cars were registered in the state in the last one year, which was expected to cross 2000 in the coming year after the exemption came into effect.
