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Elon Musk’s Tesla will not receive a tax break from the Indian government

Those hoping to see Tesla’s electric vehicles in India will have to wait a while longer, it appears. Tesla co-founder Elon Musk has been asking for tax concessions on its electric vehicles, but the Indian government appears unwilling to budge. Instead, the government claims a provision for domestically manufacturing automobiles in India, which is the standard practice among numerous big luxury carmakers in the nation.

Tesla has been urged to produce domestically by Prime Minister Narendra Modi’s administration. Musk, on the other hand, wants India to slash import taxes on electric vehicles by up to 100%. Musk claims that this will allow the business to initially offer automobiles made overseas at competitive pricing. It does, however, levy import charges ranging from 15% to 30% on goods supplied for assembly.


According to the article, Tesla has failed to offer a strategy for local production and procurement from India, despite the government’s request, according to Johri. The federal budget released earlier this week did not include any tax benefits for the cleaner but imported automobiles. However, the western state of Maharashtra, which is home to the financial hub Mumbai, officially supported Tesla’s requests.

Politicians from at least 5 Indian states have asked Tesla to set up shop in their respective provinces, following Musk’s announcement last month that the U.S. electric-vehicle pioneer was still encountering several problems with the federal government. Instead of fully-finished units, India has requested Tesla to consider importing knocked-down units or partially completed vehicles, which carry a lesser import charge.


Tesla’s proposals also come when established players such as Mercedes-Benz have revealed plans to manufacture electric vehicles in the nation. Later this year, the EQS will be assembled domestically by the carmaker. Furthermore, mass-market players such as Maruti Suzuki and Hyundai are working on affordable electric automobiles for Indian consumers.