Hopeful that the government will have a rethink on GST rate on hybrid vehicles+, Maruti Suzuki said it will continue to push the technology in India. The company said it will continue to offer mild hybrid versions of its Ciaz sedan and multi-purpose vehicle Ertiga despite prices of the models going up by over Rs 1 lakh after GST implementation. Also Read - Ola to offer free oxygen concentrators to the needy
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Under the new tax regime, hybrid vehicles are on the same slab as luxury cars at 28 percent GST plus 15 percent cess. At 43 percent, total tax incidence on these vehicles is higher from the previous effective tax rate of 30.3 percent. “When we decided to implement hybridization, it was done with an aim of making vehicles environment-friendly and improve efficiency, not only in India but also globally. That position remains unchanged,” Maruti Suzuki India (MSI) Managing Director & CEO Kenichi Ayukawa told PTI. He further said: “Unfortunately, GST doesn’t allow hybridization but we have to continuously communicate with the government”. Also Read - OnePlus India partners American Express for cashback deals, EMI offers and more
When pointed out to him that already Finance Minister Arun Jaitley has hinted that the tax rate on hybrid cars would not be reviewed, Ayukawa said: “People’s opinion sometimes change”. Stressing that “there is some misunderstanding”, he said, “I think in the long term hybridization will contribute to the Indian automobile industry”. When asked if MSI would stop offering the mild hybrids of Ciaz and Ertiga, Ayukawa ruled out such a step saying SHVS (Smart Hybrid Vehicle by Suzuki) is “good for the environment and for customers”. “Our Ciaz has 10 percent more fuel efficient than the competition, why should we stop selling it?” he asked.