Maharashtra bats for Tesla on EV tax; Tata Motors, Mahindra have opposed Elon Musk pressure

Tata Motors and Mahindra & Mahindra have opposed pressure from Elon Musk led Tesla to lower taxes.

Maharashtra urged centre to lower tax rates on imported cars following calls by Elon Musk led Tesla. (REUTERS)

Maharashtra state on Wednesday urged the central government to lower tax rates on imported cars in the budget on Feb. 1, following calls by electric carmakers like Tesla. Maharashtra is a leading auto manufacturing hub for domestic carmakers like Tata Motors and Mahindra & Mahindra , both of which are investing in manufacturing electric cars locally and have opposed Elon Musk led Tesla's pressure to lower taxes.

The state's environment minister in his letter to Prime Minister Narendra Modi's finance minister, Nirmala Sitharaman, said lowering taxes for a limited period of time would boost India's supply chain ecosystem and manufacturing process for electric vehicles (EVs).

"Pioneering companies like Tesla, Rivian, Audi, BMW among many others must be given a time-bound concessionary customs rate for the import of vehicles," Aditya Uddhav Thackeray said in the letter, released by him on Twitter.

Thackeray, also recommended in his letter lowering the tax rate for a maximum period of three years or for a defined number of vehicles for any company that wishes to import EVs or auto components to build such cars in India.

Currently, India levies import duties as high as 100% on high-end cars, including EVs, in a bid to protect and promote the local industry. Tesla, which wants to begin selling cars in India, is lobbying to reduce the rate to 40%.

Maharashtra's plea to Modi's government follows a tweet by Tesla CEO Elon Musk last week in which he said the company was "still working through a lot of challenges with the government" ahead of a possible launch in India. 

U.S. lawmakers call Tesla expansion in Xinjiang 'misguided'

 (Reuters) Two U.S. House lawmakers who head subcommittees on oversight and trade criticized the recent expansion in Xinjiang, China by Tesla.

"Your misguided expansion into the Xinjiang Uyghur Autonomous Region sets a poor example and further empowers the (Chinese government)," said Democrats Bill Pascrell and Earl Blumenauer in a letter to Tesla Chief Executive Elon Musk.

Tesla announced recently it opened a showroom in Xinjiang, the latest foreign firm caught up in tensions related to the far-western Chinese region where detention camps have drawn heavy criticism.