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Tamil Nadu Electric Vehicle Policy 2019
Shayma Shamim
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Published on 17th Nov 21

Tamildulectric Vehicle Policy 2019

The Tamil Nadu state government has designed the Tamil Nadu Electric Vehicle Policy, which aims to create a completely electric vehicle (EV) ecosystem in the Tamil Nadu state. The electric vehicle policy aims to create a sustainable manufacturing ecosystem, accelerate the use of electric vehicles and convert India into an ideal hub for manufacturers of electric vehicles and components like cost infrastructure, batteries, Electric vehicle parts, and many more. This policy includes specific incentives on purchasing and owning an Electric vehicle to encourage investment by new companies in the production of electric vehicles. Tamil Nadu has announced its EV policy for 2019 and plans to put forward a revised policy for EVs in 2021. The government currently allows 100% tax exemption for all-electric vehicles in the Tamil Nadu State. There are currently about 14,000 electric vehicles (EVs) in Tamil Nadu, and this number is expected to grow in the coming years. The reason behind the low sales of Electric vehicles is the lack of a fair price and that too especially in the two-wheeler industry.


Tamil Nadu Electric Vehicle Policy

Electric Vehicles, Electric Vehicle businesses, and charging stations and ports must comply with the FAME II guidelines issued by the Government of India in order to be subject to demand-side incentives. The charging infrastructure and components must meet the guidelines and specifications issued by the Energy Department of the Indian Government.

  • The government of Tamil Nadu has announced that electric vehicles (EVs) will be 100% free of motor vehicle tax.
  • Electric vehicle manufacturers and their spare parts producing units will avail significant benefits. The minimum investment of these manufacturers is Rs 500 million, which will create jobs for at least 50 people.
  • By 2030, 100% of the State Goods and Services Tax (SGST) for electric vehicles manufactured and sold in Tamil Nadu will be refunded.
  • By 2025, investments in the production unit of electric vehicles and batteries will receive a 15% and 20% subsidy, respectively.
  • A 15% grant is being made to cover land/ownership costs for parts electric vehicle projects in the National Business Zone. Projects that are started in the southern region will receive a 50% subsidy on Electric vehicle investment until 2022.
  • Stamp duty fee will be 100% exempted on the purchase of land for the production of electric vehicles and units of electric vehicles.
  • Tamil Nadu plans to create the first industrial sector in the country to specialize in the manufacturing of electric vehicles. The state aims to invest about Rs 50,000 crore in the electric car industry and has announced several incentives to attract investment in this electric vehicle market.
  • The policy calls for all autonomous rickshaws in Tamil Nadu's six major cities: Chennai, Trichy, Madurai, Coimbatore, Salem, and Tirunelveli, to be converted to electric vehicle cities within ten years. It is gradually going 5% electric per year, importing 1,000 state electric buses per year, and will also ask private bus owners to switch to electric.
  • Under this policy, the government will pay up to Rs 48,000 per year in employer contributions to the EPF until December 31, 2025, for all new jobs created in the electric vehicle field and claiming staff. Over the next 20 years, the state will increase capital subsidies to manufacturers of electric car batteries by 20%.
  • Electric vehicle production units and charging infrastructure are exempt from 100% of the electricity tax until December 2025.

Wrapping Up

Tamil Nadu has already announced a comprehensive policy for electric cars in 2019, including supply and demand incentives and subsidies. The upcoming revised policy focuses more on the EV ecosystem and encourages more and more EVCS manufacturers to install more and more charging stations. It also supports manufacturing units in various segments such as production, electric motors, designing EV power systems, and battery and charging station management systems.

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