No GST Cut for Flex-Fuel Vehicles, Govt Clarifies in Lok Sabha

The Government of India is promoting alternative fuels for vehicles through various measures, including mandating fuel retailers to offer alternative fuels and notifying emission norms. Ethanol and biodiesel supplied for blending receive a 5% GST, and unblended petrol faces an extra excise duty. However, flex-fuel vehicles continue to attract a 28% GST, similar to conventional vehicles. The GST Council, in its 52nd meeting on 07.10.2023, discussed reducing GST on flex-fuel vehicles but made no changes. While the Centre hasn’t appealed to reduce GST, MoRTH has urged states and UTs to consider road tax reductions on flex-fuel vehicles as an incentive.