The Delhi government on Wednesday said it will reduce VAT (Value Added Tax) on hybrid cars and battery-operated vehicles from 12.5 % to 5 %, in a bid to reduce air pollution in the capital.
“The Delhi government is committed to reduce the air pollution in the city and support eco-friendly mode of transport. This will bring relief to a large number of people earning livelihood through e-rickshaws”, an official government statement said.
With the reduction in VAT, there would be a tax rebate of lakhs for buyers of hybrid cars.
“It is expected that a large number of consumers will shift from petrol/diesel vehicles to hybrid vehicles, thereby bringing down vehicular emission,” the statement added.
It said the government was committed to making VAT rates the lowest in the country.
“In the last financial year, VAT on timber was reduced from 12.5 % to 5 %. In the current financial year, the VAT on a number of commodities including marble, sweets, namkeens, school bags, footwear and readymade garments has been reduced significantly,” it said.