BMW India President Proposes ‘Green GST’ to Encourage Shift Towards Greener Cars

The President of BMW Group India has suggested the introduction of a ‘Green GST’ where the tax rate varies based on a vehicle’s emission levels. He believes this would be an ideal step towards achieving carbon neutrality. According to him, such a tax regime would naturally push consumers towards purchasing greener, low-emission vehicles, aligning with global environmental goals.

Speaking at the launch of the BMW M4 CS in Mumbai, he said, “The greener the car, the lower the GST should be. This approach would prompt people to choose eco-friendly cars, helping India progress towards carbon neutrality.”

BMW, which currently leads the luxury electric vehicle (EV) market in India, is not considering introducing plug-in hybrids (PHEVs) due to the lack of incentives for such technology. This stance differs from that of Mercedes-Benz, which believes that incentivizing hybrids could slow the transition to pure EVs. The BMW president reiterated that the focus should be on taxing EVs lower than hybrids to promote fully green vehicles.

Despite the luxury car market in India being relatively small, accounting for less than 2% of total car sales, BMW has seen positive growth in 2024, selling 10,556 cars in the first nine months, including 725 electric cars.

He emphasized that the introduction of a Green GST would not only benefit customers by making greener cars more affordable but would also aid the Indian economy’s goal of carbon neutrality.

Key Takeaways:

Green GST proposal: Lower tax rates for greener cars based on their emissions.

BMW India sees the potential for higher EV adoption through favorable tax policies.

The company aims to grow both its luxury EV and conventional car segments equally in India.

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