India should consider taxing passenger vehicles based on emissions rather than length and engine size of vehicles, for a cleaner environment, Nissan Motor India MD Rakesh Srivastava said on Tuesday.
Nissan, which is looking to drive in its global sport utility vehicles, including the X-Trail into the Indian market to strengthen its presence in the country, said multiple technologies such as hybrids must also be considered to curb air pollution through automobiles.
“We can have different tax slabs based on the level of emissions,” Mr. Srivastava said here in an interaction, adding the government already had a different tax structure for below four metres, above four metres, in terms of length, and in terms of fuel. Under the GST regime, cars attract the highest tax slab of 28% and on top of that a cess is levied.
Small petrol cars with engine capacity less than 1,200cc attract only 1% cess, while diesel cars with engine capacity of less than 1500cc attract 3% cess, on top of the 28% GST rate.
Similarly, sport utility vehicles (SUVs), which include cars with length exceeding 4,000 mm and having a ground clearance of 169 mm and above attract a GST rate of 50%.
Also, the total tax incidence on hybrid vehicles in the country is 43%, which is inclusive of GST, while battery electric vehicles attract a tax of about 5%. “I think the time has come, maybe, to look towards incentives in the market place based on emission levels, that is going to bring a cleaner and greener environment,” Mr. Srivastava noted.
The company, which currently sells models like Magnite and Kicks in the country, is looking to drive models like X-Trail, Juke and Qashqai into the country.
All the three models come up with different levels of hybrid technology.
On Tuesday, the automaker announced that it is studying the feasibility of X-Trail and Qashqai for the Indian market.
Testing has already begun for the X-Trail and Qashqai in the Indian road conditions. Focusing specifically on their adaptability to Indian roads and differing terrains, the tests will assess each vehicle’s ability to meet customers’ needs.
Once testing is complete, the X-Trail will be introduced for sale first, followed by other models, the automaker said.
“The Indian market has boundless potential, and it is critical that we introduce the best vehicle line-up to align with what modern Indian consumers want and need,” Nissan India President Frank Torres said here.
Following the success of the Magnite in India, the company plans to strengthen focus and leverage its expertise on SUVs, he added.
Mr. Srivastava said the showcase of the three global products is part of the transformation the company intends to undertake in the country.
When asked if the new launches would help the company its market share, he noted: “We are addressing mindshare.. what is important for us is to showcase the Nissan brand strength in India and that is the first thing we would like to do in the Indian market, build up on the mind share of our customers, volumes will come.” The vehicle assessments are part of a holistic study that Nissan is undertaking to prepare for its future in India.
The wide-ranging review also includes securing future localised production for the long-term viability of domestic and export manufacturing, as well as exploring the potential for electrification in the longer term.
Nissan has been present in India for nearly two decades now but has so far remained a niche player with a low single-digit market share in the 30 lakh annual domestic passenger vehicle segment.
