Electric and Hybrid cars the way to go

Sri Lanka seems to be on the right track when it comes to electric and hybrid cars as countries around the world have ramped up their promotion of hybrid and electric cars. As China tries to improve air quality and dominate new vehicle technology, the Chinese government expects one in five cars sold to run on alternative fuels by 2025.

France and Britain plan to end the sale of gasoline and diesel-powered cars by 2040.

Caption: Finance Minister Mangala Samaraweera said that the import taxes on electric cars will be reduced by at least Rs. 1 million while the import tax on the high end fossil fueled cars will be increased by almost Rs. 2.5 million.

Presenting the budget for 2018, Minister of Finance Mangala Samaraweera announced that all vehicles in the country will be powered by non-fossil fuel sources by 2040. To this end, all government vehicles will be converted to hybrid or electric vehicles by 2025.

Furthermore, from January this year, Samaraweera said that Sri Lanka will follow the environmentally-friendly Euro 4 emissions standard as adopted by European nations.

To promote the use of electric cars, Minister Samaraweera proposed that taxes on the importation of electric vehicles including electric three wheelers, cars and buses will be reduced. As such, import taxes on electric cars was reduced by at least LKR 1 million.

In addition, the Loan to Value (LTV) ratio for motor cars which was set at 50:50 at was further relaxed for Hybrid vehicles where one could get a loan of up to 70% of the value.

Although electric vehicles and hybrids account for a small portion of the global market now, automakers including those, like Tesla, that produce only electric models, and giants like Volkswagen who produce both electric and hybrid vehicles have bet billions of dollars that such vehicles will soon be as cheap and ubiquitous as conventional cars.