The Central Board of Indirect Taxes and Customs ( CBIC ) has issued Notification No. 12/2019 - Central Tax ( Rate ), dated 31.07.2019, which seeks to reduce GST Rate on Electric Vehicles and Charger from 12% to 5% w.e.f. 01.08.2019.
HSN CODE : 8703 GST RATE : 28% DESCRIPTION : MOTOR CARS AND OTHER MOTOR VEHICLES PRINCIPALLY DESIGNED FOR THE TRANSPORT OF PERSONS (OTHER THAN THOSE OF HEADING 8702), INCLUDING STATION WAGONS AND RACING CARS.
Not only the lower GST Rate, the Government has also introduced a new Section under CHAPTER VIA of the Income Tax Act 1961 i.e. Section 80EEB which allows deduction for interest paid on LOAN taken for purchasing ELECTRIC VEHICLE. [ Applicable from AY 2020-21 ].
Hence, it would be better to buy Electric Vehicles now rather than Petrol/Diesel Vehicles.
Many more incentives to come in the near future from the Government side.
With a motive to make a pollution free India by reducing vehicular pollution, the Finance Bill pro-
posed a new deduction under Section 80EEB. As per the proposed section, a deduction of up to Rs.1.50 lakhs shall be allowed to an individual for the interest paid on loan taken for purchase of an electric vehicle, subject to the condition that the loan should be sanctioned during the period April 1, 2019 to March 31, 2023.
Hence, you can claim upto Rs. 1,50,000 under Section 80EEB on interest paid on loan taken for purchasing EV's.
The Finance Bill, 2019 proposes a new deduction under "Section 80EEA" in order to incentivize the purchase of affordable housing. The objective of this deduction is to provide an impetus to the ‘Housing for all’ objective of the Government and to enable the home buyer to have low-cost funds at his disposal.
As per the proposed section, a deduction of up to Rs. 1.50 lakhs shall be allowed to an individual for the interest paid on loan taken for acquisition of a residential house property, subject to fulfilment of following conditions : -
a) Stamp duty value of the house property should not exceed Rs. 45 lakhs.
b) Loan should be sanctioned by the financial institution during the period April 01, 2019 to
March 31, 2020.
c) The assessee should not own any residential house property on the date of sanction of
loan.
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