Tesla's call for tax benefits for the sale of Electric Vehicles rejected by India

According to recent reports, the Indian government has denied Elon Musk's electric vehicle (EV) company Tesla's request for tax breaks to import electric vehicles, arguing that rules already allow partially-built vehicles to be imported and assembled locally for a lower price.

"We looked at whether the duties need to be re-jigged, but some domestic production is happening, and some investments have come in with the current tariff structure," Vivek Johri, Chairman of the Central Board of Indirect Taxes and Customs (CBIC), was quoted as saying in an interview with Bloomberg. "So, it is clear that this is not a hindrance," Johri added.

Tesla has been urged to produce domestically by Prime Minister Narendra Modi's administration. At the same time, Musk wants India to decrease import taxes, which can be as high as 100%, so that the business can sell vehicles made overseas at competitive costs first. It does, however, levy import charges of 15 to 30% on parts transported for assembly in the country.

According to a recent report, Musk, who has been trying to introduce Tesla in India for the past few years, is still plagued by "major hurdles" at the government's end, which have prevented his electric cars from being driven on Indian roads.

Despite the government's efforts to entice him with numerous programmes and promises, as well as repeated pleas from top ministers to "come and manufacture/assemble your cars here," Musk is "still working through a lot of issues with the government," according to the source. The major barrier for Tesla in entering the Indian market, according to industry experts, is the import charge.

The Tesla Model 3 may remain an inexpensive model in the United States, with a global pricing of $39,990. According to the report, with import charges, it would become expensive in the Indian market, with a price tag of roughly Rs 60 lakh.