The cost of diesel cars may rise after Minister of Road Transport and Highways of India, Nitin Gadkari proposed a 10% GST hike today, while speaking at a convention in New Delhi.
Warning car manufacturers, the union minister said that it would become “difficult to sell” diesel vehicles after the tax increase. “Say bye to diesel soon, otherwise we will increase so much tax that it will become difficult for you to sell these vehicles,” Mr Gadkari said.
The minister said the additional 10% tax will be levied for pollution and is expected to submit this proposal to the finance minister today. The move is being seen as a push to limit the number of diesel vehicles and in turn facilitate the introduction of more electric vehicles on Indian roads.
After Mr Gadkari’s comments, Tata Motors, Mahindra and Mahindra and Ashok Leyland’s shares fell between 2.5% and 4%.