Tesla Asks For Lower Tax On Imported Cars So It Can Sell Electric Vehicles At Affordable Prices

JAKARTA – Elon Musk's electric car company, Tesla, will soon build a factory in India. This information was reported by Elon Musk himself. However, Tesla wants the import duty on imported vehicles to be lowered.

The request was stated in a letter addressed to the Ministry of India. In his letter, Tesla hopes to be able to sell electric cars soon in 2021. A source stated that Tesla wants the federal tax on imported electric cars to be lowered to 40 percent from the previous 60 percent.

The reason is, with the 60 percent tax, the company will find it difficult to sell its electric car at an affordable price for the community. However, if the tax is reduced to 40 percent, Tesla could charge its electric car at a low price.

"The argument is that with a 40 percent import duty, electric cars will be more affordable but the threshold is still high for companies to produce locally if demand increases", said the source as quoted by CNBC.

Tesla's request does not seem easy to realize. The reason is that the Indian government is currently trying to have a high import tax due to the increasing industrial demand in setting up factories in their country.

Elon Musk does want to immediately set up a factory in India, but there are still obstacles that he has to overcome to realize this desire. Musk said the impediment in a reply to a tweet from a social media user, on his Twitter account.

"We'd love to do it, but the tariffs are the highest in the world by far of any major country", Musk said.

"But we hope that at least there will be temporary tariff relief for electric vehicles", Musk added.

Reportedly, not only Tesla is asking for a reduction in import duty tariffs on imported cars, but other luxury car manufacturers also hope that the import car tax can be lowered by the Indian government.