The Centre is pushing for the introduction of a 5% levy on electric vehicles as part of a wide-ranging Goods and Services Tax (GST) overhaul, which aims to reduce tax rates on essential goods. The proposal will be discussed at a two-day session of the influential GST Council presided over by Union Finance Minister Nirmala Sitharaman.
Under the overhaul, tax brackets could be cut from the current four tiers to two, seeking to ease the tax burden on everyday items. However, states ruled by opposition parties have expressed concerns about potential revenue losses and are demanding compensation.
Prime Minister Narendra Modi had unveiled plans for these reforms, and the Group of Ministers (GoM) has already endorsed the proposal to eliminate the 12% and 28% slabs, with a special 40% rate recommended for certain items like luxury cars and tobacco.
(With inputs from agencies.)
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