After tax waiver on hybrid cars, UP govt extends EV subsidy scheme till 2027
UP EV Subsidy Scheme: Days after waiving registration fee on hybrid cars in the state, the Uttar Pradesh government has announced that its EV subsidy scheme has also been extended for three more years.
Muskan 
Days after it waived the registration fee on hybrid cars in the state, the Uttar Pradesh government has now announced that its EV subsidy scheme, too, has been extended by three more years. Reports on CNBC TV suggest that the incentive scheme for electric cars and two-wheelers purchased till 2027 has now been extended by the state government. The state had launched the Electric Vehicle Manufacturing and Mobility Policy, under which subsidy is available on electric cars and two-wheelers purchased till 2027. The state had launched its EV policy last year in 2022 to encourage the use of electric vehicles.
The FAME, or Faster Adoption and Manufacturing of Hybrid and Electric Vehicles, subsidy scheme on EVs was announced way back in 2015. Two years later it was replaced by the current FAME II scheme. The scheme, originally mooted to end on March 31 this year, had provided subsidies on electric vehicles sold in India since 2019. In the first phase of the scheme, Centre had allocated Rs 529 crore.
While the second phase used an amount of Rs 10,000 crore to offer subsidies for a period of three years. Earlier this year, the Centre had said that EV subsidy under FAME II would be eligible for electric vehicles sold till March 31 or till the funds ran out. The government had also increased the allocation for the EV subsidy scheme to Rs 11,500 crore.
The Union minister, speaking at an event organized by SIAM today said that the FAME III scheme is still being finalized and, all likelihood, would not be announced with the forthcoming Budget session.
"Preliminary work is already underway. All ministries have recommended the way to implement the FAME III programme. In future, it is being implemented in a few months or some future days. It is in the final stage," she said.
During the time for an interim budget, the Finance Minister, Nirmala Sitharaman, had allocated Rs 2,671.33 crore for the subsidy scheme on EVs.
The Union minister had also gone on to say that no decision had been taken yet regarding a cut in taxes on hybrid vehicles. While electric vehicles are taxed at only 5 per cent in India, hybrids attract a levy of up to 43 per cent—slightly lower than the 48 per cent tax on petrol cars. Gadkari had earlier stressed the fact that currently, EVs are levied at five percent while hybrid cars are taxed as high as 48 per cent, so this needs to be rationalized to encourage more climate-friendly vehicles for combatting fast pursuit of climate change and air pollution.
