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The electric car company, Tesla has been pushing hard to enter the Indian market. One of the major issues the company is facing is the high import cost of vehicles in the country. To help with this, the US-based automaker had reached out to the Indian government asking for a tax cut. Now, according to a new report by Bloomberg, the Indian government has turned down the demand stating that the rules already allow the automakers to bring in partially-built vehicles and assemble them locally at a lower cost. Also Read – Tesla recalls Full Self-Driving update from over 50,000 electric cars

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According to the report, Vivek Johri, chairman of the Central Board of Indirect Taxes and Customs has stated that the government has looked at the current tax structure to check if it needs to be rejigged. However, the officials have found out that some domestic production is already happening and some investments have come in with the current tariff structure. Due to this. he states that the current tax structure is not a hindrance. With these statements, Johri has hinted that the government is not interested in reducing the import tax. Also Read – Union Budget 2022: Forget Bitcoin, RBI to launch new Digital Rupee this year

The Indian government has been encouraging Tesla to manufacture its electric cars in the country, with a lot of states inviting the company to set up a plant. However, Tesla CEO Elon Musk has other plans. Musk is asking for the country to lower taxes for imported cars, so that he can import the cars manufactured elsewhere and sell them in the country. Also Read – Fisker Pear electric car to launch in India: Company partners with iPhone maker to build new EV

Many car manufacturing companies have voiced their concerns about Tesla’s demand, stating that this would disrupt the level playing field for them.

The Indian government has requested Tesla to present any plan for local manufacturing and procurement from the country. It has also asked the automaker to consider importing knocked-down units (CKD), which would attract a lower import duty compared to Completely Built Unit (CBU) models.

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