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Tamil Nadu eVehicle Policy 2019

Tamil Nadu e-Vehicle Policy 2019

The TN Government has unveiled the “Tamil Nadu e-Vehicle Policy 2019” to build a comprehensive electric vehicles (EV) ecosystem in the State. The Electric Vehicle Policy aims at creating sustainable eco-system of manufacture and increased use of electric vehicles and make the State has a preferred destination for the EVs and component manufacturing units including battery and charging infrastructure. This policy envisages a special package of tax incentives and infrastructure sops to promote new industrial investments in the manufacture of electric vehicles. Let us look in detail about the “Tamil Nadu e-Vehicle Policy” in detail.

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Key Highlights of the Policy

The following are the key highlights of the e-Vehicle Policy Policy:

• The policy will support and attract Rs.50,000 crore investments for EV manufacturing and also ensures to build up to 1.5 lakhs new job opportunities.
• It is proposed that all EVs such as two-wheelers and three-wheelers, cars, buses and commercial vehicles to be provided with 100% road tax exemption for the private and commercial electric vehicle till the end of 2022.
• Special incentives will be granted to the EVs and their components manufacturers those who have invested a minimum amount Rs.50 crores, that take towards creating employment opportunity for at least 50 people.
• 100% refund of the State GST (SGST) for EVs made and sold in Tamil Nadu until 2030.
• Capital subsidy of 15% and 20% for investments in EV manufacturing and battery production, respectively till 2025.
• Exclusive EV parks in the major auto manufacturing hubs.
• A subsidy of 15% subsidy will be provided on the cost of land/property for an electric vehicle or parts production project in the state’s industrial parks. For the projects started in the southern districts, the investors will get 50% subsidies until 2022.
• 100% exemption from the stamp duty will be provided for the purchase of land to establish EV and EV part units
• The establishment EV or parts production units in the Tamil Nadu will also get a 100% exemption from the electricity tax
• The Government will establish Charging for the infrastructure projects on its own or through public-private partnerships are to be encouraged.
• Certain changes in the laws/provisions of building and construction to the incorporate charging infrastructure in the planning stage.

Section 80EEB: Electric Vehicle Deductions

Incentives for e-Vehicles 

• The Government assures the policy support for the development of ‘charging infrastructure’ in cities and other places, even as it has structured a full road tax exemption package for e-autos, waiting of permit fees for e-autos till December 30, 2022, e-taxis and all-electric transport vehicles till that date.
• The policy includes incentives for the conversion of all auto-rickshaws in six major cities of the TN State such as Chennai, Tiruchy, Madurai, Coimbatore, Salem and Tirunelveli to EVs’ within a span of 10 years, to be extended to other places in a phased manner, conversion of 21,000 government transport buses into EVs’ at the rate of 5% every year, introduction of 1,000 EV buses every year, and private bus operators will also be encouraged to transit to EV buses.
• All school buses, mini-vans that are registered with the government, besides small commercial vehicles, transport vans, etc., will also be encouraged to transit to e-vehicles gradually, as per the new policy. Further, the purchase of new electric two-wheelers will be exempted from road tax till December 30, 2022, and registration charges waived as per Government of India’s policy notification.
• The policy said for all new jobs created in the EV segment, till 31.12.2025, the government will pay an incentive up to Rs.48,000 per employee for 1 year towards the employer’s contribution to the EPF. A higher capital subsidy of 20 per cent will be provided for units making EV batteries for 20 years.

Tax Incentives

The tax incentives include 100 per cent reimbursement of state GST (SGST), to manufacturing companies, on their sales effective till December 31, 2030, The reimbursement will be up to 100 per cent of eligible investment.

Separate plates

In order to distinguish electric vehicles from others, registration number would be exhibited in yellow colour on a green background for transport vehicles and in white on a green background for all other EVs.

Concessions for Manufacturers of e-Vehicle

The Tamil Nadu e-Vehicle Policy which provides for various concessions to the manufacturers and users of e-vehicles are as follows:

• EV-related and charging infrastructure manufacturing units will be provided with a 100% exemption on electricity tax till December 2025.
• Units that obtain property by sale or lease would be entitled to a 100% exemption on stamp duty for transactions till December 2022.
• The units that get the property from the SIPCOT, SIDCO or other governmental agencies will be provided with a 15% subsidy on the cost and will be provided 50% subsidy if the investment is in the southern districts.
• The units will be provided with an employment incentive in the form of the reimbursement of the employer’s contribution to EPFO for all new jobs created until December 2025.
• The government will provide a higher capital subsidy of 20% of the eligible investment over 20 years in making EV batteries.
• Amendment to building and construction laws will be effected to ensure that charging infrastructure is integrated at the planning stage itself for all new constructions and apartments in cities.